Chapter 4

business men to start cheese factories.

"REALTORS"

Certain phases of the real-estate business requiring concerted action, and especially the desire of the higher type of land dealers to put their trade or profession on a higher level, and thus to prevent it from falling into disrepute in the public eye, have led the better type of real-estate men to organize themselves into local real-estate boards with an associate membership of leading local merchants, bankers, lawyers, and others particularly interested in real-estate developments. The "realtors" prefer to speak of their trade as a "profession" or "calling," not a business or trade, for they claim that an up-to-date real-estate dealer is a community builder and leader whose preparation requires a good general education and a special training, pointing out that a number of the best colleges in the country are giving courses in the real-estate business.

Nineteen local boards from thirteen states formed a national association in 1908. At present the association comprises 130 local boards in this country and Canada, with a total membership of about 8,500 persons.

The aims of the National Association of Real Estate Boards are to promote efficiency among its members, to be a clearing house for the exchange of information and ideas, to publish an organ of the association, to broaden the sphere of influence of the local real-estate men, to assist in organizing local boards, to fight the land "sharks" and "curbstone brokers," and to maintain a high standard of professional ethics.

The members of the associated local boards call themselves "realtors," as distinct from "real-estate men" or "land dealers"--names which, they feel, are tainted by the unscrupulous methods of the "sharks."

The association has published a code of ethics for its members, in which paragraph 13 is especially noteworthy. It reads:

As a duty to the public and each other, members should report to the board misrepresentations or any fraudulent, criminal, or illegal act pertaining to real estate, which may entrap and injure innocent or ignorant persons; and the board owes it to members and the community to take steps to stop such practices and to punish parties guilty thereof.

The local boards often render certain services to the community. The valuation committees are often called upon to give their expert advice in land matters even to the courts and government administrative offices.

But how far the association is successful in combating the underhand business methods of the unscrupulous real-estate men is very difficult to say. The fact is this, that the association favors public registry and regulation of the real-estate trade and at present is working toward that end, supporting bills of this nature that are introduced in the state legislatures. A number of the realtors are not in favor of the words "license" and "licensing." They prefer instead the words "certificate," "registry," and "regulation," believing that the word "license" is associated in the popular mind with saloon-keeping and similar trades of a lower order.

The desire of these men to separate from ordinary real-estate men by calling themselves "realtors" and their business a "profession," and their advocacy of public regulation, show that the land "shark" is still very much alive and that the real-estate men themselves by their own private efforts are not able successfully to combat the "shark."

In the field of private land dealing there is appearing a substitute for the individual dealer. The modern colonization company has recently grown up, and out of this new project have grown broader policies and methods.

V

PRIVATE LAND COLONIZATION COMPANIES

The earlier so-called city and empire builders were in most cases nothing more than dealers in land. When a lot or farm was sold, there the company's interest ended. The modern colonization company goes much farther. When a man settles on land, the company of the better type usually looks out for him, backs him with credit, affords him the service of an expert agricultural adviser, cares for his health, and promotes his social interests and activities through a salaried community worker.

All this is done by the company not only for the sake of the settler himself, but mainly for the sake of the business interests of the company, since the success of the settlers on the company's land is the best advertisement of the company's business. It creates confidence in the company among the searchers for land and helps to increase the volume of business and the profits. Such companies are of rather recent origin and as yet are comparatively few in number. Their appearance means specialization in the land-development business.

In the North Middle Western states the wilderness land has been for the most part owned by the lumber companies. The lumber companies attempted to dispose of their cut-over and burnt-over land in the easiest way by selling to individuals. As a rule this retail selling was unsuccessful. They found that it was more profitable for them to stick to their lumber business and sell their land in large tracts to the land dealers and to land-development and colonization companies.

In this connection it is interesting to note that in the wilds of our north one may still see the following stages of frontier life as they exist side by side, sometimes overlapping and crosscutting one another.

1. The earliest stage known to American civilization was that of virgin wilderness inhabited by animals and roamed over by Indians. As remnants of that time there are found some animals, now driven into the swamps and rocks, and a few Indians settled on reservations.

2. The next stage was when the white missionaries, traders, adventurers, followed by professional trappers, began penetrating the wilderness. This white men's hunting stage is still represented by the present-day "shackers" and trappers, though they are mostly of an amateur character, and, so to speak, domesticated.

3. The following stage was when lumbermen began being heard throughout the forests. They are still there, though in considerably reduced numbers. They are hurriedly attacking the remaining woods, leaving in their wake a dreary, sorrowful-looking expanse of cut-over and burnt-over lands.

4. These cut-over lands are now invaded by the land development and colonization companies, with their armies of new settlers, attempting to transform the last remnants of wilderness into fertile gardens, fields, and meadows. This is the last decisive war of man upon the wilderness--a picturesque and difficult struggle. A settler gives this vivid description, printed in the Radisson, Wisconsin, _Courier_:

Everywhere we go we see men, women, and children cutting and piling the brush and logs that have covered the ground since the days of the logger. Everyone seems to be trying to clear more land than his neighbor, and get it ready to produce the crops that are so badly needed all over the world, and as we stop a minute to take a better view of what each one has done, we hear the boom of dynamite that is following the brush lines as they are being pushed back.

In the north the land-clearing line is called the firing line, a term which can be taken literally, for the land-clearing front is continually under fire and clouds of smoke from burning debris.

5. The sturdy new settlers, the last pioneers and frontiersmen in the country, are followed, especially along rivers where water power is at hand, by industrial workers. Here and there are appearing thriving manufacturing and commercial towns--the last stage in the opening up of a new country to civilization.

But the most important work in the wilderness at present is that of the modern land colonization companies. To give an idea of their work and methods it is necessary to describe one of these companies in detail.

A TYPICAL COMPANY

The particular company investigated with special attention is located in the wilderness of one of the North Middle Western states. In general the company is applying the same business methods to land colonization as Mr. Ford is applying to automobile production--production of new farms on a large scale so as to diminish the overhead expense, and standardization of various colonization methods. The guiding test is the success of the new settlers on the company's land. Failures among the settlers are avoided and fought against by the company as though they were a dangerous epidemic. "Each failure among our settlers is a bad advertisement for our company, a loss to us, and an evidence of defects in our business methods," stated the company's head.

To insure the success of the settlers and the settlement, the company proceeds as follows: The most careful study is made of the tract of land which the company intends to acquire for colonization purposes. Not only is the tract of land closely looked over by the company's officials, but land experts, such as soil surveyors, are engaged to examine the land from the viewpoint of its agricultural possibilities. Federal and state surveyors' reports are also used in considering the possibilities of the land.

When the land has been acquired, a plan for a colony is worked out, with provision for necessary roads, town sites, irrigation or drainage systems, utilization of water power, social centers, experimental farms, etc. The accompanying map shows the plan of one such colony.

The tract is then surveyed and cut up into farms according to the plan adopted. A number of farm lots are selected by the company. On each of these lots there is designated a place for the farm buildings and the garden. A simple, inexpensive house and a barn are built by the company on a small clearing, usually facing the main road. At present the company has ceased to clear any land for agricultural use for the reason that if there is a piece of cleared land the new settler is apt to expend his main efforts on cultivation of this cleared land, neglecting the clearing of more land.

Our experience has shown that it is much better when a new settler begins his settlement enterprise with clearing. He at once acquires the needed experience in clearing, and develops the confidence that he is able to overcome the difficulties of clearing. As a result, his ambition grows to clear more land each year,

explained a company official. This again shows with what fineness the company has to adjust its methods to the psychological peculiarities of the settlers.

At the same time the company equips the experimental farm and puts it into operation under the supervision of a trained agriculturist. For the community work a hall is provided and a community worker engaged.

Meanwhile the company's agents and advertisers have been busy in making the land opportunities known to people who are intending to settle on land. The new settlers are of two distinct types. One type consists either of native Americans or immigrants who have previously been on land in the United States either as landowners or as tenants. The second class consists of immigrants who have been living in the cities and who desire to settle on land. In most cases they have been engaged in agricultural work in their old countries.

The company itself takes into consideration racial and national factors. In the year of the investigation the company was doing its main business in the one section with Polish immigrants, and preferred them even to the native settlers. The reason given was that immigrants, especially Slavs, are easy to get along with and readily follow the company's directions and advice. They are hard workers and are satisfied with a small return at the beginning. In contrast, the natives commonly pay little attention to the company's directions and advice, being anxious to make a quick success. In case they do not succeed as rapidly as they expected, they get discouraged, leave the place, and give the company a "black eye."

The land is sold in plots of forty acres each, either as "made-to-order" farms or without farming improvements--"land only." The purchaser may buy as many plots as he desires and is able to pay for. However, the company discourages the buying of more land than the settler is able actually to improve and cultivate, which usually is about forty acres.

The company offers in its folder the following three land sale plans:

PLAN NO. 1

LAND ONLY, WITHOUT IMPROVEMENTS

First payment, $200 for each 40 acres. Total cost, $750 to $1,000 for each 40 acres.

If you buy under Plan No. 1 you pay for the land only. Should you want lumber or building supplies, we will furnish them to you at cost, and add on to your contract. The same is true in case you want live stock. In other words, we will furnish supplies equal to the amount of the first payment. Prices vary according to location and quality of land.

PLAN NO. 2

FORTY ACRES OF LAND WITH HOUSE AND LIVE STOCK

House 14x20 feet, 1 story, 1 cow, 1 small pig, 4 chickens, Complete assortment of vegetable and flower seeds, 1 bushel mixed clover and timothy seed.

Cash payment, $250. Total cost, $1,100 to $1,350.

These plans cover only 40 acres. If you wish larger acreage add to these plans what land you require, at $750 to $1,000 per 40-acre unit.

PLAN NO. 3

FORTY ACRES OF LAND WITH HOUSE, BARN, LIVE STOCK, AND TOOLS

House 14x20 feet, 1-1/2 story, Barn 12x14 feet, 1 cow, 4 chickens, 2 small pigs, Complete assortment of vegetable and flower seeds, 1 bushel mixed clover and timothy seed, 1 garden cultivator, 1 crosscut saw, 1 ax, 1 brush scythe, 1 mattock.

Cash payment, $400. Total cost, $1,250 to $1,500.

These plans cover only 40 acres. If you wish larger acreage add to these plans what land you require, at $750 to $1,000 per 40-acre unit.

As experience has shown, a settler on new land which he has to clear has no opportunity for using a horse to its fullest capacity during the first two years. Therefore the company does not include a horse in the preliminary equipment of a "made-to-order" farm. When a new settler needs horse power either for plowing or hauling he hires a horse from his older neighbors or from the company's demonstration farm at a reasonable price.

One of the company's special efforts consists in securing a market for the settler's produce. With this end in view, co-operative creameries are favored and promoted by the company.

It is the policy of the company to encourage the organization of local state banks wherever it does any colonizing work, for the company realizes that the short-time credit needs of the settlers must be taken care of. It always encourages the local merchants and people in the near-by towns to take some stock in the bank. Whatever stock is left over, different members connected with the company usually take, upon an understanding with the local people that as soon as any of them wish some of this stock the company will sell it to them at 6 per cent interest on its money.

A number of years ago the company organized a bank in one of its colonies in order that the settlers might get proper credit. The company found it necessary to do something, as heretofore the settlers had had no opportunity to secure short-time credit. After the bank had been organized for three years the people in the colony desired to take the bank stock, and the men connected with the colonization company sold all their stock with the exception of one or two hundred dollars each, which the local people desired that they retain, so that out of $10,000 capital stock $1,000 is held by men interested in the company. In another colony some of the local people spoke for some stock and were offered the stock held by men interested in the colonization company at exactly what they paid for it, plus 6 per cent interest on their money. This has been true in the different sections where the company has promoted the organization of a bank.

As the company's business methods are based upon the principle of the settler's success, the company is keeping in very close touch with its settlers. For each settler a "Progress Record" card is filed in the company's local office. The following reproduction of the main features of the card indicates the items that show the economic progress of the settler. Although it is not possible to have all the items filled up to date, a beginning is always made. As visits are made to the settlers' farms by the company's representatives, or the settlers come to the company office for advice or help, information is collected and added to the cards. Eventually an invaluable record of salient facts in regard to the settler and his progress is accumulated in this way.

SETTLER'S PROGRESS RECORD

Name ....................... Address .......................

DESCRIPTION Acres .............Sec............Tp..........R........ ......... .............Sec............Tp..........R........ ......... .............Sec............Tp..........R........ ......... County..............State...............Total acres......... Soil...............Distance from school................miles From town..........miles. Name........................... Nationality........Age..............Children................ Previous farming experience................................. Bought........acres..........from........................... (year and month) Moved on land in..............191.... From.................. I had in cash.................In stock...................... Tools and machinery......................................... Total net worth (when I moved on land) $................

improved Price paid for unimproved land, $........................... _____________

Paid in cash........................................ Balance due.........................................

Improvements, Equipment, and Live Stock included in purchase price....................................................... ............................................................ Terms of contract........................................... Interest rate 6 per cent.

RECORD OF PROGRESS

_1st 2d 3d 4th 5th 6th 7th 8th_ _yr. yr. yr. yr. yr. yr. yr. yr._

Built....................................................... Cleared (plowed)............................................ Cleared (stumps in)......................................... Fenced...................................................... No. of cows................................................. No. of calves............................................... No. of horses............................................... No. of colts................................................ No. of pigs................................................. Days worked out............................................. Owed on chattel............................................. Owed bank................................................... Paid on land (prin.)........................................ Paid on land (int.).........................................

PRESENT VALUE OF PROPERTY

LAND ------------------------------------------------------------ _Acres Classification Acres Acre Total_ _Fenced Value_ ------------------------------------------------------------ .........Cultivated......................................... .........Cultivated (stumps in)............................. .........Meadow (wild hay).................................. .........Unimproved......................................... ------------- Total value of land..............$.............

BUILDINGS ------------------------------------------------------------ _Size Material Insured For Total_ ------------------------------------------------------------ House....................................................... Barn........................................................ Silo........................................................ ------------- Total value of buildings..........$............

LIVE STOCK ------------------------------------------------------------ _No. Value, Total_ _Each_ ------------------------------------------------------------ .........Dairy cows......................................... .........Dairy heifers...................................... .........Dairy calves....................................... .........Beef cattle........................................ .........Horses............................................. .........Colts.............................................. .........Hogs............................................... .........Sheep.............................................. ---------- Total value of live stock.....$..........

MACHINERY .................................................. .................................................. ---------- Total value of machinery.......$..........

_Assets_ _Liabilities_ Value of land.......$...... Due on land........$...... Value of buildings............ Due on live stock......... Value of live stock........... Due on machinery.......... Value of machinery............ Other debts............... Value of other property....... ------- -------- Total..........$...... Total.......$....... Present net worth......$.......

These progress records are valuable to the company for a number of purposes. They help in considering extension of credit, in giving advice to the settlers, and in finding out what general business methods are the best for the company to follow in the way of assisting the settler to make a success.

As the settler's future well-being depends to a certain degree upon his progress in Americanization, it would be advisable for the company to include in the record cards items concerning the date of the settler's arrival in America, his naturalization status, and the degree of his knowledge of English at the time of his settlement on land. These few additional items would hardly complicate or burden the recording work of the company's local office.

THE ADVISER

The company's officials stated that the immigrant family when first arriving in the colony is shy and helpless. The introduction of the family to the new conditions and surroundings has to be made gradually. A representative of the company meets the family at the station and directs it to a hotel, where it stays a few days before it is taken to the farm. During these several days the company's adviser calls often upon the family, talks with its members, takes them through the colony and introduces them to their future neighbors, and explains the local conditions. When the family is transferred to the farm the company's adviser still has to call almost daily, for there are numerous matters upon which the settler needs advice and encouragement.

The majority of the new settlers are quite ignorant of the methods of land clearing. This the adviser has to teach them. How to feed cows, what and when to plant, how to cultivate, and how to handle the products--in all such questions the new settlers need constant direction. They themselves give two reasons for their need of advice in farming operations. First, the European methods of farm work are different from the American methods, especially because in Europe they were not engaged in opening up new land. Secondly, having been engaged in industrial work in America, often for long years, they have forgotten the European farm experience to a certain degree.

While the writer was in the office of the adviser the settlers were constantly calling upon the latter for advice in all sorts of matters. One woman came, crying, and said, through her boy as interpreter, that her cow was sick and perhaps dying. Another woman sought advice as to her sick baby. A man came to ask that a certain road be extended to his place. Still another man wanted to do some stumping on his land in co-operation with his neighbors, provided the company lent a machine and the adviser came to direct the work. Another man asked advice in regard to the extension of credit to him. So the stream of inquiries went on continually. The adviser needed to be, as he was, an extremely capable man to deal with the extraordinary list of demands. He was an expert agriculturist, energetic, and in love with the game of helping the immigrant settlers.

In regard to the need of a trained adviser for the new settlers the president of the company explained as follows:

The greatest need for instruction is in land clearing, for the modern land-clearing methods--methods of just how to "brush," and at what time of year to conduct the operations--are entirely new to almost every settler arriving in the colony. No wonder we ourselves are studying, experimenting, and improving on land-clearing methods each month.

In general, our immigrant colonists are efficient workers. The fact is that some of the buildings in our new town site are being built by our settlers. A large number of them were contractors. Many of the foreigners worked in the shipyards on the coast. Some of them worked on big farms. We find them very intelligent and capable, and some of them very good business men. We have built over twenty miles of road this year, every bit of it being done under contract, and the contracts were all taken by our new settlers. During the past year about two hundred houses were built, and these were all contracted to the new settlers.

It is true they have many things to learn, just as we have. We are not really teaching them, but we are working with them, studying with them, learning much from them, just as they learn from us. We are opening up our demonstration farms, studying the problems just as they are. Our adviser's main work is to assist them in choosing the kind of seed best adapted to that country, to act as a kind of leader for the community, for they are all strangers, and until they have become accustomed to the country, and until leaders have sprung up among them, it is necessary that an outside leader, such as our agricultural adviser, should be employed, but not because of the ignorance or inefficiency of the foreigners.

Observing the actual operations of such advisers in a number of cases, the writer has been convinced that in every new rural immigrant colony an intelligent, sympathetic, and efficient adviser is needed, and that the private colonization companies are to be commended for employing such advisers.

CHILDREN OVERWORKED

In one of the colonies the writer observed that the settlers' children worked a great deal. On one farm three children--two boys and one girl--of ages varying from nine to thirteen or fourteen, were clearing land of stones and the debris of brush and stumps. On another farm, the settler's wife, with her two tiny and delicate girls, was cultivating potatoes, each one using a rake. On a third farm, two boys, one of ten and the other of twelve, were cutting hay with scythes. The boys were thin and pale. In talk they appeared serious and somewhat cheerless, although in a measure enthusiastic about their new farm.

The company's local officials and also the settlers themselves admitted that their children work considerably, even to the extent that they are often kept home from school. The settlers said that they understood the harm being done their children both by working too hard and by being withdrawn from school. But they are very eager to put their new farms on a paying basis in the shortest possible time. The company's officials said that they had so far not interfered with the use of child labor, but that in the future they would try to exercise some supervision over the work of children in the colony.

The president of the company stated in regard to the labor of the settlers' children that "in some cases in the cities, on the farms, and everywhere, there is an indiscreet use of child labor, as also there is a practice in many communities of letting the children run wild. I believe I would rather trust future America to those brought up in pioneer regions than I would trust future America to those brought up under conditions where no hardship, no pioneering, no work whatever is expected of them."

While this is quite true, nevertheless the writer's impression was that a number of the settlers overwork their children and keep them out of school at times.

SECURING CREDIT

As the company's overhead expenses for the maintenance of a number of offices, for the employment of a large number of agents and for commissions and extensive advertising, are heavy, the company is able to do successful business only on a very large scale. The head of this particular company believed that, in view of this fact, the tract of good farming land on which a company operates must be not less than 50,000 acres. He also stated that in view of the fact that the company's outlay of money, and especially its extension of credit to settlers, is very large, the reliable land development and colonization companies ought to be assisted in the way of credit by the public through the government.

During the war the company had great difficulty in borrowing money on the settlers' mortgages. They had to pay a high rate of interest. Since the end of the war, however, the company has been able through the banks of the financial centers of the North Middle West to float a large number of collateral bonds on mortgages. These bonds at the present time sell to the general public at 6 per cent. The company, its president stated, must pay the cost of trusteeship commission on sale of bonds, etc., which brings the rate which the company pays to a fair amount above the 6 per cent which the ultimate investor receives. At the present time there is no difficulty in financing the organization, although it would be very desirable to have state and Federal assistance.

Bills providing for such assistance have been introduced in the state legislatures of all of the northwest states. Congressman Knutson at Washington has introduced a land credit bill to provide capital for the development by land colonization of the agricultural resources of the nation, providing for certain privileges to soldier settlers, and creating a National Colonization Board.[7]

CONSERVATION OF WOODED LAND

While the company has made provision for the conservation of riparian rights, for roads, and even for town sites, it has done little for the conservation of wooded land. It has preserved the woodland on river banks and 160 acres of timber in one colony, and it has planted about 15,000 small pine trees. Moreover, the company encourages the conservation of woodland by the settlers, advising them to keep in timber from five to ten acres for each farm.

How far the settlers will follow this good advice remains to be seen, while the conservation of wooded land by the company is inadequate. This the company's local officials admitted, but they reasoned that it would hardly be advisable for a single company, or even a number of companies, to attempt to conserve wooded land or other natural resources the return from which would be in the far distant future. It would be advisable for the state, or even for the Federal government, to make provisions and necessary regulations for the conservation of wooded land and other natural resources upon which the well-being of the public at large depends.

THE SIZE OF A COLONY

A number of Polish settlers in one of the colonies visited expressed the desire to have a Polish church and school. They believed that if the national Catholic Church organization would help them, they themselves would be able to maintain their church and school.

This fact led the writer to a discussion with the company's officials as to the advisable size of a compact colony of the same nationality. They stated that if an immigrant family is established among settlers of another nationality, the family becomes lonely and desperate and after a year or two of such loneliness is apt to leave the farm, no matter how successful it has been in buying and cultivating the land. Therefore the company's policy is to settle the people of the same nationality together.

The writer asked whether, if a colony of one nationality is large, having a hundred or several hundred families, the resulting conditions would not make for separation and isolation. They would have intimate intercourse only with one another, would establish a church and school of their own nationality, and would even develop their own town and elect their own local government officials. The company's officers admitted that this would possibly happen; they said that the company had not yet decided how large a colony of one nationality, in the same locality or neighborhood, it would develop.

The personal opinion of one of the officials was that from fifteen to twenty-five families of one nationality in the same neighborhood would not be a source of danger because of becoming clannish and remaining un-Americanized for a generation or a number of generations. A colony of such size would not be able to maintain a church and school of its own nationality. As to the danger of inbreeding, the officials pointed out that the church rules and state laws would prohibit it, and said that, furthermore, the immigrants, having friends and acquaintances elsewhere in the country, would marry into other groups of immigrants.

LEARNING AMERICAN WAYS

The writer, while visiting the company's colonies, was struck by the fact that the settlers who said they had been in this country from eight to ten years understood and spoke very little English, seemed to be rather shy, and in general appearance lacked signs of American influence. Overalls and the tools in their hands were almost the only betraying marks of the American environment.

The investigation developed the fact that most of the settlers had lived previously in the congested "Little Polands" in Chicago, Detroit, and Milwaukee. The settlers explained that they lived there as in the old country, having their own Polish church, Polish schools, Polish banks, Polish stores, Polish books and papers, speaking Polish in their homes, in the streets, and in social gatherings. Even in the factories where they worked, their fellow workers were often Poles; sometimes even the foreman was a Pole. There was almost no opportunity for coming in contact with the American ways of life and with the country's language.

Several settlers declared that they had learned more about America and had used English more during the last two years in the northern wilderness than during the previous seven or eight years in the city of Chicago. Settling on land, they came in contact with the American land agents, other company officials, government authorities, American banks and stores, and with American neighbors at the community meetings. Here in the wilderness they first found how badly they needed English and a knowledge of American ways. A number of parents started to learn English by taking lessons from their children, who themselves were learning English in the local public schools.

The company's officials stated, in confirmation, that the Polish settlers in their colonies were growing in dignity and self-reliance, that they were assuming American characteristics and an American bearing.

TWO POINTS OF VIEW

As the colonies of the company are comparatively young, it is impossible to foresee their future with certainty. So far they seem to be on a sound basis, and their success rather than their failure is to be expected. The soil is good and the settlers stick hard to their work on the land. The first colony founded seems to be over the danger line already. It is no longer under the financial control of the company, the settlers have secured loans outside, and their farms are progressing from the experimental stage to that of established security.

However, a settler expressed the following apprehension to the writer:

You see us, men and women, old and young, working here in the wilderness like beavers, clearing and digging, scraping and building. All are pressed hard by a strong hope of establishing a permanent home and of earning future independence. But we still live in makeshift houses, and so far only a few families are able to make a living, bare and meager, out of their clearings, diggings, and cows. The vast majority--almost all of us--have, at times, to leave the farm in care of women and children and look for work elsewhere--in Duluth, Chicago, Detroit--for the purpose of earning bread for the family on the farm. A number temporarily hire out to the company, but the latter's wages are considerably less than we get in the industrial centers.

You have heard the company's officials and seen their doings, and everything might seem to you to work smoothly for the benefit of the settlers. Is it not so? For instance, the company claims that it sells us tools at cost, but we already have found out in regard to a number of things that the company makes a fair profit on them. Again, the company claims that it runs the demonstration farms only for our benefit, but as a matter of fact the company's aim is, as we understand it, to build up a large farm estate on the best land of the tract, and to sell us its products, seeds, breeding stock, etc.; in other words, to make money out of demonstration. One hardly can object to this, except that the company claims that it is doing business with us "at cost," which is not so.

Almost in everything, even in our home life, we depend upon the good will of the company, and so far we have not much complaint to make against it. In general, it has treated us well under the existing circumstances, but we are a little apprehensive about our future. Suppose we, as settlers, finally succeed in making good, clear our land, and build up our farms, as expected by the company and hoped by ourselves. Will we then be free and independent of the company's control? We are afraid not. We will still have to transact our financial matters through the bank in which the company is interested, sell our products through the company's agency, etc., not because any law or stipulation would require this, but solely because the company, with all its business establishments, is here among us. The company is retaining river shores, town sites connected with certain business privileges, and the best pieces of land, as its demonstration farms. This means that the company, with its fatherly care for us, is going to remain with us for a long time to come.

The field notes of the writer on the above statements of the settler were later shown to the company's head, who answered them as follows:

The expression "makeshift houses" is not fitting at all, for the buildings are warm and comfortable--hardwood floors, painted wall board inside. They are small, it is true. You can travel the country over, where pioneers are located, and I defy anyone to find a better-looking set of houses than those in any one of our colonies.

This man states that so far only a few families are able to make a living. In our older colonies I could show a list of cream checks which the different settlers are receiving from their cows; they will range all the way from $50 to $400 a month. This does not take into consideration the surplus live stock, potatoes, and other grains, which they sell from their farms. It is not expected that these new settlers will make money out of their crops for the first few years. It is expected that they will go away to the cities and work part of the time, while their families remain on the land. We state in our literature, as does all state literature, that the first two or three years contain hardships, and mean some working out to earn money, provided the settler comes without any funds whatever. The survey of all our settlers shows that while they have worked in the city ten to fifteen years, their entire savings have amounted to from $200 to $1,000. In the colonies, due to clearing, increased value of land, and earnings on their new farms, they have made from $500 to $1,000 a year. Surely this entails some hardship and some hard work.

The statement that some of them hired out to the company at less wages than are paid in industrial centers I'll agree was true during war times. We could not hope to compete with the wages paid in the munition factories of the East. The company does, however, pay standard wages, as high as are paid anywhere for the same class of labor.

The statement that the company claims that it sells the necessities at cost is not correct, for the company sells nothing. We have an iron-bound practice that in no case do we enter into the store or sales business. We furnish the original house, barn, tools, live stock, with the land. After that we sell nothing. We have often stated that if we would enter into the store business or selling business, it would drive others out, and it was poor practice for the company to engage in any business outside of colonization, for it involved too much detail and was a separate business. Colonization is a game all of itself, and if we divided our energies with other industries we could not succeed.

Some time ago a charge similar to this was made by some of the settlers, stating that the company was making profits on buildings. We immediately offered to have any lumber company agree to put up those buildings for the same price that we did. We asked for a large number of bids, and the nearest bid was one hundred and twenty-five dollars more than the price we were charging the settlers. We did not ask them to bid on only one house, but on one hundred houses a year. The reason we have been able to construct these buildings at such a low rate is that we have our own timber. When the price of lumber went up during war times, we did not increase our price one dollar. By building hundreds of houses each year, by eight or ten years of experiment, and keeping the same foreman and crew, we have been able to develop an efficiency that will allow us to put these buildings up at one hundred dollars less than the best bid we could get from anyone. We would gladly give up this detail work if some one else could do it, for we make no money on it and barely take care of costs and our necessary overhead.

As to furnishing cattle, we made an offer to one of the local Holstein and Guernsey associations, asking them if they would be willing to furnish all of our settlers cows at the same price we were asking, and deliver them at the same time we were delivering them; we could not get anyone to accept our offer. We have lost money right along on our live stock--not a great deal, but a small amount. So when your informer tells you that they purchase goods from the company at a fair profit to the company, the statement is not correct, for we sell no goods to them at all except what goes with the land. In no case do we buy anything from the settlers, and in no case do we sell anything to them, except the original equipment which goes with the original purchase.

The statement that the company's purpose is to reserve large demonstration farms is laughable, for we only have two demonstration farms reserved in our entire tract of 60,000 acres. Those two demonstration farms cover 2,500 acres. Already one demonstration farm in a colony where we sold practically all the land has been cut up into small farms and offered for general sale. The other demonstration farm is in the vicinity of our present settlement and is not now broken up.

In our oldest colony we reserve not a foot of land there. The cheese factory which we started we turned over to the co-operative organization. The warehouse which we constructed we turned over to a Co-operative Shippers' Association.

There is one thing that your informant is correct on, and that is that we retain the river shores. We have retained the riparian rights for the reason that some day we hope to turn this over to a water-power company and develop hydroelectric power for the benefit of that whole community. If these river shores were in the hands of different settlers, it would be impossible for a hydroelectric company ever to go in there and purchase each farm separately at a price that would enable it to develop the power.

The contradictions in the above interviews are to be explained by the settlers' misunderstanding of the company's general policy and methods. In their eyes everything in the colony belongs to and is managed by the company, which is quite true at the beginning of the colony, and which cannot be otherwise at that time. The new settlers know little of one another, and are ignorant of the local conditions. They lack both business experience and capital. Therefore, as a rule they are not able to conduct, either individually or on a co-operative basis, commercial or industrial establishments at the start. It is therefore up to the company to see that there is a town, a hotel, a grocery store, a bank, a creamery, or cheese factory, a shipping office, etc., in the colony.

The fact that the company has interests in, and even controls, these concerns at the beginning, and that all these business branches work together, conducting their financial transactions through the same bank, has led the settlers to believe that everything is permanently owned and controlled by the company. The settlers in a new colony do not know that as soon as the success of these business organizations is secure and the settlers have been assisted to a firmer footing the company will turn the organizations over to the settlers themselves on a co-operative basis, as has already been done in the company's oldest colony. It is the company's policy, as above stated by its head, to specialize in the land colonization work only, leaving banking, commerce, and manufactures to others.

COLONY SNAPSHOTS

The writer visited and investigated two colonies of new settlers founded by the colonization company within a distance of about twenty to thirty miles from one another. The following field notes taken during interviews with the company's local officials and the settlers themselves give a general picture of the conditions of the colonies.

In the first colony, the first families settled about twelve to fifteen years ago. At that time a logging camp was operating and the country was covered with standing timber. As fast as the loggers cleared the timber the land was opened for settlement by the colonization company. Land buyers were taken into the logging camp, were given meals and sleeping quarters there, and were taken out and shown their land. About five years after the first settlers came most of the timber had been cut. The company then established the village and began settling from that point. The colony has steadily increased and at present contains about fifty families.

The settlers were Polish. About ten families came from Russia, twenty from Germany, and twenty from Austria. They left their old country on account of poverty, political oppression, and compulsory military service there. Almost all of them had been engaged in agriculture in the old country. About forty families had been employed in shops and factories in America before they succeeded in settling on land here; only about ten families came from Europe directly to the colony, of which they learned through the company's advertisements in the American-Polish newspapers and also through the letters of their friends and acquaintances.

The largest farm is 120 acres, the smallest 20 acres, and the average 80 acres. Most of the farms are still under mortgage, only a few being cleared of debt.

In the colony and its vicinity are seven schools: six with one room and one with three rooms. All teachers are native born and all teaching is in English. The settlers appreciate education. Most of the children are inclined to farming and will remain in the colony. One fourth of the adults do not speak English, one half only speak English, and one fourth speak and write English.

Only a few of the adult male settlers have second papers; about nine tenths have first papers, while the rest are totally unnaturalized. In explanation of this fact the company's president stated that it is only the older men who have not secured even their first papers.

A large proportion of the foreign settlers [he said] secure their second papers just as rapidly as they can after they locate on the land. They desire to take part in local politics; they find that they must become interested in local political affairs if they wish to have a good system of schools, roads, and gain the other advantages which both the county and town can give them. They are also interested in the state politics. All this brings the question of second papers forcibly to their minds, and in an accurate survey of the different colonies we are interested in, you will find that a large per cent of those who have been on the land five years or more have already secured their second papers. One of the difficulties which hinder them from getting their second papers sooner is the fact that they must have some one certify that he has actually known them for a period of five years. Coming as they do, strangers from another state, it is necessary that they live among us for a five-year period before such an affidavit can be secured. I have had many of the settlers speak to me, desiring second papers, but they were forced to wait their period before they could secure them.

Most of the settlers read the Polish newspapers published in America. Quite a number of families take books from the school libraries; among these are a few Polish books--stories and histories.

The settlers are of the Roman Catholic faith. They attend a local church. Their Catholic neighbors of other nationalities attend the same church. The priest is of the Polish nationality; he cannot speak English well. He is appointed by the bishop. The settlers would prefer to elect their priest themselves.

While the houses are of the American type, the interior arrangement of the living rooms remains that of the European Slavic peasantry--the bedcover is often fancy handiwork, the walls are profusely covered with family photographs, pictures of Polish heroes, and magazine illustrations. However, an honored place is given to the picture of the President and the American flag. Furniture is placed against the wall around the room. The premises are kept comparatively clean and in order.

Diet is rather mixed, though the Polish meals and the Polish ways of cooking predominate. The settlers claim that their housewives are more frugal than the American housewives in their neighborhood.

There are very few intermarriages; nationality alone is considered a drawback for intermarriage between a Pole and non-Pole. In cases where the two people are of different faith, the Church is another drawback.

Family discipline, in respect to the authority of the husband as the family head, is less strict than in the old country. The settlers believe that this is due to the American influence. Here the husband has to consult his wife in every important question and the children are not so often punished.

The relations between the colonists and the national groups in the neighborhood are generally friendly and help is given mutually in cases of need. But there is very little social visiting between the groups, the difference in nationality being a bar.

The settlers secure agricultural advice from two sources--the company's adviser and the county agent. They raise wheat, rye, oats, potatoes, grasses--clover and timothy--while their main income is derived from milk production.

The products are sold to the local agents; there is no discrimination in prices. Necessities are bought in the near-by towns, prices being too high and goods not always suited to the needs of the settlers.

Money is loaned by the local banks at 7 to 8 per cent. This rate, the company stated, was on short-time, unsecured paper. The settlers, it maintained, have always been able to secure money on farm mortgages at 6 and 7 per cent.

Economically stronger families compel their children to do chores and work in the field outside of school time, while poorer and weaker families, especially those of more recent settlers, often let their children work even during school time.

The settlers are satisfied with their conditions and they all desire to remain permanently in America. The only thing they want is an increase in the number of settlers and further development of their locality.

The second colony[8] visited by the writer was started by the company the year before (1917). There are now about sixty Polish families in the colony. Half of the adult male population were deserters from the compulsory military service in Russia, Germany, and Austria. "Why should we have served in the armies by which Poland was oppressed!" exclaimed a settler when asked as to their justification for desertion.

Before settling on the land they all had worked in steel mills, factories, mines, etc., some five to six years, some longer, but their experience in Europe had been on farms. While in America they had learned of the land from the company's advertisements in the Polish papers. In regard to the settlers' previous farming experience the company's head said that

our company will not sell land to any settler who has not had some farm experience. We advise them first to work on a farm somewhere--either rent it or hire out--until they have gained the necessary experience to make them successful on their farms. These people here are not factory workers, but are primarily farmers, land hungry, who came to this country for the purpose of owning a home, and only temporarily worked in steel mills, factories, and mines, in order to secure sufficient money to get the start that they so much desire.

About ten settlers had gone, at the time of the writer's visit, to work in Duluth and Chicago. Their families and other settlers were busily engaged in land clearing. The smallest clearing was 6 acres, the largest 20 acres, and the average clearing for each farm was 10 acres--that is, about one sixth of the land was already cleared, but most of the cleared land was not yet turned. The size of the largest farm was 120 acres, that of the smallest 40 acres, and of the average 60 acres. In May the company organized a land-clearing contest among the settlers of its colonies, providing rewards for the winners. "This was a big event in our colony--the men pushed the brush for all they were worth," said the company's agent.

The settlers estimated that all of the adult males understand English, and that about 70 per cent can also speak English, though not well, while not one can intelligibly write English. Most of the adult women do not even understand English.

There is no Polish church. Once in two or three weeks a Polish priest comes. The majority of the settlers do not care about having a Polish church and school. They claim that their religious sentiment is weaker in America than it was in Europe.

Their diet is almost entirely Polish. Some families keep their homes clean and in order; some continue to live in dirt as in Europe.

Relations between the Polish and non-Polish settlers are good, though no social visiting takes place. Still, they meet and see one another at the community hall, about which the settlers seemed to be enthusiastic.

In clearing land the settlers have so far applied hand labor almost exclusively, but in the coming year horse power will be needed. Near the houses small potato patches and vegetable gardens have been planted. Field crops have been started, in a small and primitive way, and among these oats and feed grasses predominate. The sale of milk is the most important item of income of the settlers. Dairy farming is the company's aim in the development of the colony.

In regard to the clearing of land the company emphasized the point that the land does not all have to be cleared in order to produce.

Cattle are immediately turned into the brushland, and can pasture upon the brush, the native grasses, and the clover which grows throughout the entire region. Land which is cleared is used for winter food products. Summer feed for the cattle, hogs, and horses comes almost exclusively from the uncleared land. By following dairying and live-stock raising, the entire land becomes productive at once, while grain or vegetable farming would mean that only the land under cultivation would be producing.

The men of the colony seemed to be rather cheerful and hopeful, while their wives impressed the writer as being somewhat downcast and self-centered. Several of them said that they have to work much harder in the colony than in the cities or even in the old country.

[7] H. R. 3274, 66th Congress, 1st Session.

[8] Only those field notes are here quoted which vary from the description of the first colony.

VI

PUBLIC LAND COLONIZATION

California is the first, and so far the only state in the Union to undertake the public colonization of land. Its first experiment is very recent and on a comparatively small scale. Its leaders are ably utilizing their knowledge of the experiences in public land colonization in foreign countries such as Australia, New Zealand, the Scandinavian states, and Great Britain. Although it is impossible to foresee the outcome, the writer is inclined to believe that the public land colonization in California will continue to be a success, giving impetus to similar projects in other states.

THE CALIFORNIA EXPERIMENT

The California experiment and its history may be outlined briefly as follows: A report of the California Commission on Land Colonization and Rural Credits made in 1916 revealed the fact that few settlers were coming to California and that many who had come were leaving because of hardships created by high prices of land, high interest rates, and short terms of payment given in colonization contracts. As a result, the California legislature passed the Land Settlement Act, approved June 1, 1917,[9] for the purpose of

promoting closer agricultural settlement, assisting deserving and qualified persons to acquire small improved farms, providing homes for farm laborers, increasing opportunities under the Federal Farm Loan Act, and demonstrating the value of adequate capital and organized direction in sub-dividing and preparing agricultural land for settlement.

The act appropriated $250,000 for a demonstration in state land colonization, fixing 10,000 acres as the limit which should be bought. The land might be situated in one or two localities, but not profitably in more, because of the increase in overhead expenses. To carry out the provisions of the act a state Land Settlement Board was appointed of which Prof. Elwood Mead was chairman. The board was organized at the end of August, 1917, and immediately began the search for a suitable tract of land. With the advice of technical experts of the University of California and of other authorities upon soil, irrigation, health, and various conditions which would affect the success of the colony, final selection was made of a tract at Durham, Butte County, California.

On May 7, 1918, the land was finally transferred to the state. Prior to this, however, the land had been subdivided and had been prepared for farming, a large acreage having even been seeded. On May 15th, 3,421 acres were offered to settlers, consisting of 53 farms, ranging in size from 3-1/2 acres to 160 acres, and of 21 two-acre farm laborers allotments. The prices of the farms varied from $875 (above which the next price was $3,646) to $14,942. The price of the farm laborers' allotments was $400. The law provided that the value of the former, without improvements, should not exceed $15,000, and that of the latter, without improvements, should not exceed $400. The terms of sale were as follows:

Settlers were to pay 5 per cent of the cost of the land and 40 per cent of the cost of the improvements at the time of purchase, the remainder of the purchase price to be paid over a period of twenty years with interest at the rate of 5 per cent per annum. Payments of principal and interest were to be made semiannually in accord with the amortization table of the Federal Farm Loan Board.

All applicants for land were carefully considered as to their character and their fitness for farming. The minimum amount of capital a settler was required to have was fixed at $1,500 or a working equipment of equal value. A farm laborer was not required to have any capital, but had only to pay the initial deposit of $20 and semiannual payments of about $15.

The board reserved the right of supervision of the methods of cultivation of each settler, of the state of repair of buildings, of fire-insurance policies, and of other details.

Plans of houses and barns were prepared and the board offered to build these, or others, for the settler, on payment of 40 per cent of the cost. An engineer was employed to supervise the erection of buildings and to help settlers plan the grouping of buildings, orchard, garden, and field. The board bought material at wholesale and let contracts in groups and in this way each family was saved much money and valuable farming time.

The board kept the following objects in view:

1. That the settlement become widely and favorably known as the home of one breed of dairy cattle, one breed of beef cattle, one breed of hogs, and one or two breeds of sheep.

2. The co-operation of the settlers in buying and selling.

3. The establishment at Durham, or on the settlement, of a training school in agriculture.

4. The erection in the near future of a social hall owned and paid for by settlers.

Co-operative action among the farmers and farm laborers was particularly desired and encouraged. A co-operative stock breeders' association was formed. Twenty-two acres were reserved for community use, and here it is hoped that community buildings will be erected.

When the farms were offered for sale there were from ten to fourteen applicants for each of the improved farms. Four of the unimproved farms were not applied for and these will be seeded and offered to settlers later at the opening of the next tract. Every one of the farm laborers' allotments was applied for. The settlement was made self-sustaining and productive within sixty days from the date the land was purchased.

As to the racial composition of this colony and the way in which the method of colonization would affect the incorporation of the different racial elements in the life of the settlement, the superintendent, Mr. George C. Kreutzer, made the following statement:

Five of the settlers on the colony are of German origin, two of Danish origin, two Italian, one French, and all the others are of either English, Irish, or Scotch origin.

No policy of mixing nationalities was followed. These farmers put in either a first, second, or third choice for the allotments they desired, and the board then selected the man best suited agriculturally for the particular block he was allotted.

Under our system of allotting blocks here the farmers are particularly concerned in making a success of their farms financially, rather than socially. We were never confronted with the problem of having too many of one nationality in the community, and as we have only fifty-three farms to offer for settlers, it is not large enough to involve the problem at all. Further than this, I do not think the problem will come up under this system of allotting blocks, for the reason first stated above.

It will Americanize immigrants through co-operation and social intercourse, through the various settlers' organizations necessary to their social and financial welfare. We have a Stock Breeders' Association which meets at regular times to discuss live-stock problems at intervals during the year. They are all on equal terms, each one buying the land for himself, thus breaking down class distinction. There will not be the distinction between lessees and freeholders that we find in the Middle States. Their children will go to the same school.

This undertaking of California is the only one in the field of public land colonization anywhere in the country, except for projects involving soldier settlements which some states have lately begun to undertake.

STATE PROVISION FOR SOLDIER SETTLEMENTS

With the close of the War there began to appear on the calendars of state legislatures the subject of land settlement provision for returning soldiers. Up to the time this report was written, twenty-three states had passed some legislation relative to this need. The following table indicates in a general way the extent and nature of this provision.

TABLE II

STATE LEGISLATION TO PROMOTE LAND SETTLEMENT FOR SOLDIERS UP TO JUNE, 1919[11] ---------------------------------------------------------------+ | | | Amount of State | Bill Number| Date Approved |Appropriation --------------+------------+---------------------+-------------+ Arizona | Senate 89|March 26, 1919[10]|$ 100,000 | | | California |{Senate 246|April, 1919 | 10,000,000 |{Senate 221|April, 1919[10]| 1,000,000 Colorado | Senate 262|April 9, 1919[10]| Delaware | House 182|April 2, 1919 | 25,000 Florida | Senate 21|December 7, 1918[10]| Idaho | House 100|March 7, 1919[10]| 100,000 Maine | Chapter 89|April 4, 1919[10]| | | | Missouri |{Senate 355|April, 1919[10]| 10,000 |{Senate 15|April, 1919[10]| 1,000,000 Montana |{House 130|March 11, 1919[10]| 50,000 |{House 170|March 4, 1919[10]| 200,000 Nevada | House 219|March 28, 1919 | 1,000,000 New Jersey | Senate 5|March 26, 1919 | New Mexico | House 204|March, 1919[10]| 30,000 North Carolina| Chapter 266|March 10, 1919[10]| North Dakota | House 128|March 6, 1919 | | | | Oklahoma | Number 249|March 28, 1919 | 250,000 Oregon | Senate 147|March 4, 1919[10]| 50,000 South Dakota | Senate 255|March, 1919[10]| 100,000 | | | 1,000,000 Tennessee | House 447|April 16, 1919[10]| Texas | |May 24, 1919 | Utah |{Senate 79|March 17, 1919[10]| 25,000 |{Senate 80|March 17, 1919[10]| 1,000,000 Vermont | Number 15|March 26, 1919 | Washington |{House 200|March 18, 1919 | 1,050,000 |{Senate 184|March 20, 1919[10]| 160,000 Wisconsin | Senate 8|February 23, 1919[10]| Wyoming | Senate 70|February 28, 1919[10]| 5,000 | | | 200,000 ---------------------------------------------------------------+

TABLE II--Continued

STATE LEGISLATION TO PROMOTE LAND SETTLEMENT FOR SOLDIERS UP TO JUNE, 1919[11] ------------------------------------------------------------ | State | Special Note --------------+--------------------------------------------- Arizona |To aid Federal Reclamation Service in this | state. California |Referendum on bond issue. | Colorado |No appropriation indicated. Delaware | Florida |Appropriating state lands. Idaho |Conditional upon similar Federal legislation. Maine |Necessary amount out of remainder of | reserve land fund. Missouri | |Revolving fund submitted to popular vote. Montana | |To be drawn upon if necessary. Nevada |By bond sale. New Jersey |Appropriation for placement work. New Mexico |Plus half of certain state rentals and sales. North Carolina|Commission appointed to report. North Dakota |Twenty-five dollars per soldier per month | in service. Oklahoma |For loans to land settlers. Oregon | South Dakota | |Bond issue. Tennessee |No appropriation indicated. Texas |State credit for land settlers. Utah | |Bond issue. Vermont | Washington |Revolving fund for state Reclamation Act. |For land settlement. Wisconsin |Commission appointed to report. Wyoming | |For loans to land settlers. ------------------------------------------------------------

In more than half the states the laws refer to Federal legislation, in a few cases specifying that the appropriation shall be contingent upon a national appropriation. Several states signify their approval of co-operation with Federal provision, but make no appropriation for the work. The largest appropriation in the form of a bond issue for popular approval of $10,000,000 was passed by the California legislature. Similar provision was made by Missouri, South Dakota, and Utah to the amount of $1,000,000. Nevada arranged for the borrowing of $1,000,000 for "reclamation, improvement, and equipment of lands ... for soldiers, sailors, marines, and other loyal citizens." Washington appropriated a revolving fund beginning with $1,050,000 and eventually reaching $3,000,000 to create a state Reclamation Service.

In spite of this evidence of awakened interest in soldier settlements, many such projects have died before any real attempt could be made to put them into practical operation. This is to be explained as follows. The projects in a number of cases were products rather of sentiment than of logic based upon experience. War-time patriotism created a desire to give some sort of reward to men fighting for the country's cause. "Let us give to each returning soldier a farm--a ready-made farm!" was heard throughout the country. Whether we had enough land, or economically available land, for millions of farms was not always asked. Many of the project-makers turned to our swamps, deserts, and cut-over lands filled with stumps and debris.

The easy-flowing imagination of these people, especially of the city type, made out of these lands new farms, flourishing gardens, meadows and fields burdened with crops waving in the winds. How much it would cost, whence would come the money and energy to create such a miracle, and how much time the prosecution of the plan would require was not asked. Would not our returned soldiers, who already are matured men, be in their graves before their desert and swamp farms gave a living to their cultivators? Still more strange was the common notion that all soldiers, even the crippled, were eager to settle on land--that all wanted land and all were fit to be farmers!

As the product of mere fancy, such sweeping soldiers' settlement projects were bound to die a natural death. And yet they have not been without value. They created lively discussion, and called attention to our land problems, especially to the reclamation and colonization of unused lands by the people who want land and are fit to be farmers and to do hard land-pioneering work, be they returned soldiers, native farmers, or newly arrived immigrants.

THE RECLAMATION ACT

The Federal Reclamation Service was established by an act of June 17, 1902, ch. 1093, 32 Stat., 388.[12] This act provides that the moneys received from the sale of public lands in the Western states, with the exception of the 5 per centum reserved by law for educational and other purposes, shall be set aside in the Treasury as a _reclamation fund_ to be used for the construction and maintenance of irrigation works for the purpose of reclaiming arid and semiarid lands in these states.

Authority to conduct the reclamation work is placed in the hands of the Secretary of the Interior. He is given authority to withdraw from public entry the lands required for irrigation works and to restore the withdrawn lands to public entry when their use for such purpose is over. Under the authority conferred upon him by the act (Section 4, and Opinion Assistant Attorney General, April 16, 1906, 34 L. D., 567) he may enter into contracts for the construction of irrigation works or construct such works by labor employed and operated under the superintendence and direction of government officials.

The Secretary is authorized to give public notice of the lands irrigable under such project, and limit of area per entry, which limit shall represent the acreage which, in the opinion of the Secretary, may be reasonably required for the support of a family upon the reclaimed lands; and of the charges which shall be made per acre upon the entries, and upon lands in private ownership which may be irrigated by the waters of the irrigation works. The charges shall be determined with a view to returning to the reclamation fund the cost of construction and shall be apportioned equitably.

It is provided that in all construction work eight hours shall constitute a day's work and no Mongolian labor shall be employed (32 Stat., 389). No right to the use of water for land in private ownership shall be sold for a tract exceeding 160 acres to any one landowner. It is provided that the reclamation fund shall be used for the operation and maintenance of irrigation works and that when the payments required by the act are made for the major portion of the lands irrigated the management of these works shall pass to the landowners.

The Secretary of the Interior is authorized to acquire any rights or property for reclamation purposes by purchase or by condemnation under judicial process, and to pay from the reclamation fund sums needed for that purpose. Within thirty days, upon application of the Secretary of the Interior, the Attorney General of the United States shall institute condemnation proceedings. The Secretary of the Interior is authorized to make rules and regulations for carrying the provisions of the act into full force and effect.

In the seventeen years since the passage of the Reclamation Act the surveys, examinations, and construction authorized by it have proceeded, and to-day, according to the report of the Secretary of the Interior for 1919,[13]

the service is in a position to deliver water to about 1,600,000 acres of irrigable land, covered by crop census, of which about 1,120,000 acres are now being irrigated. Besides this storage water is delivered from permanent reservoirs under special contracts to about 950,000 acres more. The projects that have been undertaken have been planned to provide for an area of about 3,200,000 acres.

A number of bills have been proposed for enlarging and extending this work.

PROPOSED FEDERAL LEGISLATION

The Department of the Interior has prepared a draft of a bill providing rural homes for returning soldiers. Copies of the bill were sent to the Governors for consideration by various state legislatures.

The bill is based on the principle of co-operation, according to which (1) the state provides land, acquiring it by purchase or by agreement with the present landowners whereby the latter turn their holdings over to the state for a reasonable price gradually paid to them out of the returns from the settlers, and (2) the Federal government advances money for reclamation through irrigation, drainage, and clearing, and for preparation of the land for immediate farming through the providing of buildings, implements, seeds, live stock, etc. The total cost of the land and improvements, with interest at 4 per cent on capital invested, will be repaid by the settlers during the course of, approximately, forty years by an annual payment of 5 per cent of the total cost.

A bill was introduced in Congress by Senator Myers (S. 4947, 65th Congress, 2d Session) in October, 1918, and backed by the Department of the Interior, which provided for a survey and classification by this department of all unentered public lands and all privately owned unused lands for the purpose of finding out what lands can be reclaimed and put to productive use by returning soldiers who would like to settle on land and engage in agriculture. After such an investigation the Secretary of the Interior was required to report to Congress and to propose a plan for the settlement and cultivation of such lands.

There were two bills (S. 5397 and H. 15672) introduced by Senator W. S. Kenyon of Iowa and Representative M. Clyde Kelly of Pennsylvania, respectively, which, among other features, made possible development of rural districts. Although differing in details, the bills both appropriated $100,000,000 to be expended in providing employment primarily for returning soldiers. This was to be done through the authorized public construction work, or through the organization and extension of useful public works, in the development of natural resources. Only in localities where the Secretary of Labor reports extraordinary unemployment to exist shall public works be carried on from this fund.

The House bill provided for the building of new post roads; for the transfer of war material no longer needed by the army, the same to be used for the construction, improvement, and maintenance of the post roads; for supplementing the public school equipment where public school buildings are or shall be designated as postal stations, for the use of the construction service; and for other purposes. The bill provides for the establishment of motor transport and postal routes; for the organization of a system of marketing facilities for the collection and delivery, through the postal service and public school buildings, of farm products from producer to consumer; and for the construction of any authorized public work.

In addition to these more indirect ways of opening up the country the bill carried specific provision for promoting and conducting land-settlement colonies, as well as provision for logging or milling operations, contingent upon a continuous yield of timber, so that the forest communities would be permanent. The provisions of the bill were to be carried out by an interdepartmental National Board of Public Construction, which would organize a body of workers, known as the United States Construction Service.

Since the bill carried the reclamation and technical land-improvement work, the only question might be, is there any need for this to be carried on by a special Construction Service? Would it not be a duplication of the work of the already existing Reclamation Service of the Department of the Interior? Would it not be economical and otherwise proper to increase the staff and other working forces of the Reclamation Service to the extent of the proposed reclamation duties of the Construction Service?

Representative E. T. Taylor of Colorado introduced in the House, February 15, 1919, a bill (H. R. 15993) providing for employment and the securing of rural homes for returned soldiers and for the promotion of the reclamation of land for cultivation under the direction of the Secretary of the Interior. Short-term loans to settlers were provided for. This bill contains a good land-development plan, except that the Reclamation Service, Department of the Interior, ought not to be burdened with colonization work and with loans to settlers. Colonization work ought to be the duty of a separate body, and the extension of credit to settlers naturally belongs to the Farm Loan Board, Department of the Treasury.

Representative Mondell of Wyoming introduced in the House, May 19, 1919, a bill (H. R. 487) providing employment and rural homes for returned soldiers through the reclamation of lands under the direction of the Secretary of the Interior, who may, for this purpose, acquire by gift, purchase, deed in trust, or otherwise, the necessary lands for soldier settlement projects and, for the same purpose, may withdraw, utilize, and dispose of by contract and deed suitable public lands. An appropriation of $500,000 is proposed.

The plan in this bill for the acquisition and reclamation of unused land is a strong one. Equally commendable is the provision for safeguarding the settlers' holdings against speculation, for the selling, leasing, or mortgaging of the land by settlers requires the approval of the Secretary of the Interior. The bill requires that the Interior Department, through its Reclamation Service, acquire and improve lands, colonize them, and make loans to settlers. It would seem a more efficient plan to make a division of these various duties. The Reclamation Service should acquire and improve lands for settlement, while the colonization work and the extension of loans to settlers would be made the duties of other public authorities, as pointed out below.

House Bill No. 3274, introduced by Representative Knutson, May 27, 1919, proposes to create, in the Treasury Department, a National Colonization Board with local colonization commissions, for the purpose of providing capital for the development by land colonization of the agricultural resources of the nation, affording certain privileges to soldier settlers. The commissions approve and charter private colonization companies and recommend applications for loans after seeing all the provisions of the act have been complied with. The commissions are to include the directors of the district land bank.

The main aim of the bill is to standardize private land colonization companies to a certain degree, to facilitate the extension of credit to them, and to make loans to soldier settlers. The Knutson bill in meeting these needs is a comprehensive one. It deserves the closest attention of Congress. Would it not be advisable, however, to attach the administrative machinery for credit extension outlined in the bill to a division to be created in the Farm Loan Board, with separate colonization credit funds, and to leave the regulation and licensing of the private colonization companies to a separate body as outlined below?

Senator Thomas J. Walsh of Montana introduced in the Senate, August 20, 1917, a bill (S. 2812) which was passed by both Houses and reported from conference for passage in February, 1919. The bill provides for the sale or lease of coal, oil, and other mineral lands on the public domain. The leasing clause of the bill is weakened by the provision, "unless previously entered under Section 2 of this act." The public coal lands would be "entered," sold into private ownership, which means the loss of public control over these lands and the methods of their exploitation. However, the bill if passed would be a step forward in the sense that it would increase opportunities for investment of capital and employment of labor, which would result in the increase of the coal output so much needed.

The only step so far undertaken by Congress in the direction of land colonization is the appropriation of $200,000 for an investigation by the Reclamation Service, Department of the Interior, of lands outside of the existing reclamation projects. The measures needed are waiting for action.

In regard to the available land for acquisition, reclamation, and colonization, several projects are proposed by the above-quoted bills and by various Federal departments. The principal projects are as follows:

1. Agricultural:

a. Logged-off lands in the North Middle Western and Northwestern states.

b. Irrigation of desert lands in the Southwestern states.

c. Drainage of swamp lands in the Southern states.

2. Forestry projects; permanent colonies for logging, milling, and reforestation of logged-off lands in the Northwestern states.

3. Colonization projects for an intensive cultivation of lands around smaller growing towns.

4. Colonization projects in Alaska for developing various extractive industries.

Action of some sort is eminently desirable in this country, especially in view of the fact that other countries have already taken steps to these ends.

PROVISION IN OTHER COUNTRIES

The settlement of soldiers on land has been a problem much considered in all of the warring nations. Although the plans are just only being tried out for the first time in many cases, they are suggestive of the trend that land-settlement laws are taking.

In 1918 a law was enacted in France "providing for the acquisition of small rural properties by soldier and civilian victims of the war. It provides in part for 'individual mortgage loans to facilitate acquisition, parceling out, transformation, and reconstitution of small rural properties of which the value does not exceed 10,000 francs.' The loans are to be made from the agricultural lending societies at a rate of 1 per cent, with a term of twenty-five years. Advances for improvements are provided for and a special commission is appointed to administer the law."[14]

In the United Kingdom, as well as in the majority of its dominions and states, acts providing for land settlement for ex-soldiers have been passed or formulated. Large sums of money have already been appropriated for the purchase, improvement, and development of land. In some cases the crown lands are to be used and in other private lands are to be bought. Table III indicates some of the general provisions of the legislation.

Over $133,000,000 has been appropriated and in two Australian states alone 2,060,000 acres have been set aside. The size of the individual holdings varies from 10 to 160 acres.

In some cases the land is given outright, in others the settler must help bear the cost of surveys and improvement. The third plan is that of a lease, usually with an option to buy, varying in different states. Whatever the terms of settlement are, in most cases the ex-soldier can meet his obligations because of the easy terms by which he can borrow money from the government. Although the maximum amount is limited, the rate of interest is low in most cases and the term of years, with one exception, twenty years or more. Although some farming experience is required, in almost every law, there is provision for a demonstration farm. Here the prospective farmers can learn scientific farming, usually getting paid for their work in the interval.

TABLE III

SOLDIER SETTLEMENT PLANS FOR UNITED KINGDOM AND PROVINCES[15] ------------------------------------------+ | | | | Country Act | ------------------------------------------+ Dominion of Canada[16]| August 29, 1917 | ----------------------+-------------------+ Ontario | No. 150, 1916 | | | ----------------------+-------------------+ British Columbia |6 Geo. V. 59, 1916 | ----------------------+-------------------+ New Brunswick |6 Geo. V. 9, 1916 | ----------------------+-------------------+ Australia | 1917 Conference | ----------------------+-------------------+ New South Wales | No. 21, 1916; | | amended, 1917 | ----------------------+-------------------+ Victoria | October 22, 1917 | | | ----------------------+-------------------+ Queensland | 1917 | | | | | | | ----------------------+-------------------+ South Australia | 1916, 7, Geo. V. | ----------------------+-------------------+ New Zealand |6 Geo. V. 45, 1916;| | amended, 1917 | ----------------------+-------------------+ Tasmania |Geo. V. 20; 1916-17| | | | | ----------------------+-------------------+ United Kingdom |6 and 7 Geo. V., c | | 38 | ----------------------+-------------------+ Union of South | 1912; amended | Africa | 1917 | | | | | ------------------------------------------+

TABLE III--Continued

SOLDIER SETTLEMENT PLANS FOR UNITED KINGDOM AND PROVINCES[15] ------------------------------------------------------------------------+ | Aid Given | |-------------------------------------------------+ | | | | | Maximum | | Interest | Country | Amount | Time | Per Cent | ----------------------+-----------------+-----------------+-------------+ Dominion of Canada[16]| $2,500[A] |20 equal payments| 5 | ----------------------+-----------------+-----------------+-------------+ Ontario | $500[B] | 20 years | 6 | | | | | ----------------------+-----------------+-----------------+-------------+ British Columbia | [C] [B] | 20 years | 5 | ----------------------+-----------------+-----------------+-------------+ New Brunswick |$500 to $1,500[B]| 20 years | 5 | ----------------------+-----------------+-----------------+-------------+ Australia | [C] | [C] | [C] | ----------------------+-----------------+-----------------+-------------+ New South Wales | $2,500 | Lease | 2-1/2 on | | | | capital | | | | value | ----------------------+-----------------+-----------------+-------------+ Victoria | $2,500 | 31-1/2 years | 6 | | | | | ----------------------+-----------------+-----------------+-------------+ Queensland |$2,500 buildings;| 40 years; 25 | 3-1/2 to 5; | | $3,500 | years; 10 | 1-1/2 on | | equipment |years; perpetual | capital | | | | value | ----------------------+-----------------+-----------------+-------------+ South Australia | $2,400 | 21 years | 4 | ----------------------+-----------------+-----------------+-------------+ New Zealand | [D] | | | | | | | ----------------------+-----------------+-----------------+-------------+ Tasmania | $2,500 | 21 years | 3-1/2 to 5 | | | | | | | | | ----------------------+-----------------+-----------------+-------------+ United Kingdom | | | | | | | | ----------------------+-----------------+-----------------+-------------+ Union of South | $1,250; $25 a | 3-1/2 years to | 4-1/2 | Africa | month to | 7 years. | | | families | | | | | | | ------------------------------------------------------------------------+

TABLE III--Continued

SOLDIER SETTLEMENT PLANS FOR UNITED KINGDOM AND PROVINCES[15] ------------------------------------------------------------------------+ | | Acres Assigned | | |---------------------------------+ | | | | | | |Individual| Country | Appropriation | Total | Holdings | ----------------------+---------------+----------------------+----------+ Dominion of Canada[16]| $2,910,000 |Certain dominion lands| 160 | ----------------------+---------------+----------------------+----------+ Ontario | $5,000,000 | | 100 | | | | | ----------------------+---------------+----------------------+----------+ British Columbia | $500,000 | | | | annually | | 160 | ----------------------+---------------+----------------------+----------+ New Brunswick | | 20,000 | 10-100 | ----------------------+---------------+----------------------+----------+ Australia | $100,000,000 | | | ----------------------|---------------+----------------------+----------+ New South Wales | | 1,500,000 | | | | | | ----------------------+---------------+----------------------+----------+ Victoria | $11,250,000 |500,000 wheat-growing | | | | plus irrigated lands | | ----------------------+---------------+----------------------+----------+ Queensland | $50,000 | 560,000 | | | | | | | | | | | | | | ----------------------+---------------+----------------------+----------+ South Australia | $220,000 | 10,000 | | ----------------------+---------------+----------------------+----------+ New Zealand | $3,000,000 | 270,000 | | | | | | ----------------------+---------------+----------------------+----------+ Tasmania | $750,000 | | 100 | | | | | | | | | ----------------------+---------------+----------------------+----------+ United Kingdom | $10,000,000 | | | | asked for | 60,000 | | ----------------------+---------------+----------------------+----------+ Union of South | [C] |Lands purchased not to| | Africa | |exceed $7,500 for each| | | | settler who provides | | | | one fifth of price | | ------------------------------------------------------------------------+

TABLE III--Continued

SOLDIER SETTLEMENT PLANS FOR UNITED KINGDOM AND PROVINCES[15] ------------------------------------------------------------------------- | | | | | | | | | | |Demonstration| | |Training| Farm |Capital Country | Tenure | Needed | Provided |Desirable ----------------------+-----------------+--------+-------------+--------- Dominion of Canada[16]| Free grant | Yes | Yes | Yes ----------------------+-----------------+--------+-------------|--------- Ontario | Patent given in | Yes | Yes | Yes | 5 years | | | ----------------------+-----------------+--------+-------------+--------- British Columbia | Free grant | No | | ----------------------+-----------------+--------+-------------+--------- New Brunswick | Free grant | | Yes | Yes ----------------------+-----------------+--------+-------------+--------- Australia | | | | ----------------------+-----------------+--------+-------------+--------- New South Wales | Perpetual lease | Yes | Yes | Yes | | | | ----------------------+-----------------+--------+-------------+--------- Victoria | Purchase in | Yes | | Yes | 31-1/2 Years | | | ----------------------+-----------------+--------+-------------+--------- Queensland | Perpetual lease | | Yes | Yes | only | | | | | | | | | | | ----------------------+-----------------+--------+-------------+--------- South Australia | Perpetual lease | | Yes | Yes ----------------------+-----------------+--------+-------------+--------- New Zealand | Lease 66 years, | | Yes | Yes | or freehold | | | ----------------------+-----------------+--------+-------------+--------- Tasmania | 99-year lease; | Yes | Yes | | or purchase | Yes | Yes | | after 10 years | | | ----------------------+-----------------+--------+-------------+--------- United Kingdom | Lease | Yes | Yes | | | | | ----------------------+-----------------+--------+-------------+--------- Union of South | Lease for 5 | | Yes | Africa |years and option | | | | of purchase, | | | | with 20 years | | | | to pay | | | -------------------------------------------------------------------------

[9] Senate Bill No. 584, chap. 755.

[10] In co-operation with the Federal government.

[11] Compiled from manuscript given to the author by the Department of the Interior.

[12] Federal Reclamation Laws of the United States. House Committee on Irrigation of Arid Lands, 66th Congress, 2d Session, Washington, D. C., 1920; chap. v, pp. 13-50.

[13] Reports of the Department of the Interior for the fiscal year ended June 30, 1919. Washington, Government Printing Office, 1920; vol. 1, p. 96.

[14] _Work and Homes for Our Fighting Men_, U. S. Reclamation Service, 1919 (pamphlet).

[15] Tabulated from table compiled by United States Reclamation Service, Work and Homes for Our Fighting Men, 1919, p. 20-21 (pamphlet).

[16] From Canada comes the news that at the end of January, 1921, 20,000 soldiers have taken farms, and that 42,000 of 59,000 applicants for land grants have been declared qualified and will soon get the land. Although the men have 25 years to pay off their land debt, several hundred have already paid in full. The Canadian soldiers have received 2,000,000 acres of farming land in government soldiers grants.

[A] Security required.

[B] In addition to Dominion advance.

[C] Amount not specified.

[D] Sufficient for clearing.

VII

A LAND POLICY

Most of the land-reform programs, beginning with those of the extreme conservatives, _laissez-faire_ theorists of various schools, and ending with those of the extreme radicals, anarchists, and socialists of various leanings, are primarily concerned with the question of land ownership.

WIDE RANGE IN PROGRAMS

These programs might be, in the main, classified as follows:

I. Private land ownership:

A. Large-scale ownership, subject to no public interference.

B. Small-scale ownership, limited and regulated by public authority.

II. Public land ownership:

A. Secured by

1. Confiscation, by revolutionary action.

2. Purchase, by land bond issues.

3. Taxation, by the single tax.

B. Forms of public ownership:

1. Nationalization; national ownership. In the United States it would be Federal ownership.

2. Provincial ownership. In the United States it would be state ownership, and in Switzerland canton ownership.

3. Municipalization or communalization; land owned by cities and communities in the rural districts.

4. Nobody's ownership; free to all, except that the public takes the ground value (irrespective of improvements) through the single tax, from the land users, which practically means a disguised form of public ownership, or at least a condition very near it.

C. Methods of use:

1. Parceling the public land into homesteads of one-family size, and reselling these to the cultivators on the basis of individual fee simple.

2. Giving the homesteads to cultivators on the basis of perpetual leasehold.

3. Public cultivation, either direct or through communes or co-operative associations.

Comparing these programs one with another and with the existing conditions, one reaches the following conclusions: All the programs tend to treat the land problem merely as a question of ownership. Each favors a specific form of ownership almost as an all-inclusive remedy for defects in social relations so far as they depend upon land cultivation and land use. The argument is based upon reasoning, a mere logical calculation, and on what the authors of the program desire. The existing conditions and tendencies are much more varied and complex than they seem to appear to the land reformers.

First, there is nothing new or untried in these programs, for almost all the advocated forms of land ownership are already existing side by side. It seems that no one single form is able to remedy the defects in the land situation. We have in this country national (Federal), provincial (state), and municipal or communal ownership, with small-scale private ownership predominating. We also have special land taxation, as, for instance, in certain cities that tax unimproved land higher than improved land. These existing forms of land ownership are competing with one another. The forms which allow more efficient cultivation, result in greater social stability, and are based on social justice will be the winners in the march of the economic and social progress of the country.

The bold claim of Marxian or German Socialism that large private land ownership, erroneously identified with cultivation on a large scale, is going to prevail through absorption of small private land ownership is rapidly losing ground. The small landowners are able to enjoy, through co-operation, all the technical advantages of large-scale cultivation, retaining as well the advantages resulting from individual initiative and efficiency. There is a marked movement toward co-operation among the small farmers the world over. In Denmark it has developed to the highest degree.

Second, mere land ownership is only a part, though a vital part, of the problem. Many other important things have to be considered.

If a man has land, but lacks capital or credit, he is unable to make economic use of his land. If he has both land and capital, or credit, or in other terms purchasing power, but lacks access to sources of supply in which to buy seeds, breeding stock, and implements, he still is unable to make use of his land. If he has at hand all the needed implements, seeds, and stock, but lacks knowledge and experience in farming, he might entirely fail in his enterprise. Even if he possesses the necessary knowledge and produces grain, milk, beef, and other agricultural products, he must have a market for his products, be it a domestic or an international market. This involves transportation facilities, trade organization and regulation, tariff, and other forms of organized international relationships, economic and political.

Moreover, land cultivation requires social stability, security, and order, for an investment in land improvements must wait long for its returns. If a man does not know who is going to harvest his fields, or who is going to get the product of his toil, he will be disinclined to sow anything. A striking illustration of such a state is the case of the western provinces of the Russian Empire, where the battle lines for several years were surging back and forth. First the Russian monarchy collected the farm products, then came the Germans, then came the civil warfare. When there is no security for a land cultivator, neither for his products nor his very life itself, there can be no production. There is land enough and there are cultivators enough, but the population starves because of unsettled political and international conditions.

PLENTY OF LAND

In considering the land situation as it exists, it is true that the ownership of land or, rather, the access to land, is of primary importance. The question arises, Is there enough land in the United States for all citizens who desire to become cultivators?

The Secretary of the Interior, Mr. Lane, states[17] that more than 15,000,000 acres of irrigable lands remain in the hands of the United States government. There are between 70,000,000 and 80,000,000 acres of swamp and overflowed lands in the United States of which about 60,000,000 acres can be reclaimed for agricultural purposes, and there are about 200,000,000 acres of cut-over or logged-off lands which are suitable for agricultural development.

Although it might be questioned how much of these unused lands are economically available under normal conditions--for no rigid investigation has been made--still the fact remains that unused lands--swamps and deserts, cut-over and burned-over lands--are being continually improved and taken under cultivation by private and public effort. Not one land improvement and colonization company visited by the writer complained of lack of land. All the companies seemed to want more settlers and more credit. This fact indicates that there is economically available land in our country, and probably plenty of it, for a normal process of reclamation and colonization.

PUBLIC REGULATION OF LAND DEALING

In the field investigation, the main questions of immigrants desiring to settle on land seemed to be where to find land of the "right kind," and how, in acquiring it, to avoid being cheated by private land sellers. The questions as to whether there was land available and what its price was were of minor importance. In many cases the immigrants had been employed in war industries and had saved money enough to buy a farm, but they were unable to decide where to settle and what kind of land to buy because they feared land sellers. Their experience with these agents had awakened an almost universal fear of private land dealers.

To facilitate the access to land, the private land-dealing trade must be put upon a higher level. There must be Federal legislation regulating land dealers doing business in two or more states, state legislation for dealers doing business within one state only, and municipal legislation for the land dealers doing business within the city limits only. Through co-operation of these governments uniformity of such legislation can be secured and maintained so far as various local conditions and peculiarities allow.

Such regulative legislation should aim at doing away with misrepresentation and frauds in land dealing. As an effective assistance in the enforcement of the laws all private land dealers should be licensed, interstate dealers by the Federal, state dealers by the state, and city dealers by the city governments. By refusing or recalling licenses a considerable number of land sharks--get-rich-quick charlatans in the real-estate business--can be sifted out of the trade and the necessary confidence on the part of land seekers can be secured.

According to a report made in 1916 by the Committee on State Legislation of the National Association of Real Estate Boards, a sentiment was then growing in most parts of the country favoring the enactment of laws for the regulation of real-estate brokerages under state authority. This sentiment is still growing, and the secretary of the association says that realtors in several states continue to introduce bills in their legislatures with the belief that it will be possible to pass them.

In only one state has such a law passed. The state of Wisconsin enacted a law in 1919[18] which provides for the establishment of a state real-estate brokers' board consisting of three members, at least two of whom are real-estate brokers in the state, appointed by the Governor. The Director of Immigration, Department of Agriculture, acts as secretary to the board. The latter issues licenses to the real-estate brokers and salesmen doing business in the state. An annual license fee of ten dollars from a broker and five dollars from a salesman is required. License may be refused or revoked by the board for misstatement in application, for fraud or fraudulent practices, for untrustworthiness or incompetence in real-estate business.

The board receives complaints against any real-estate broker or salesman. It may conduct hearings and investigations, subpoena and compel the attendance and testimony of witnesses and production of documents, books and papers. The board shall, from time to time, publish the names of licensed real-estate brokers and salesmen, with information as to when each license expires. The publication shall include the names of those real-estate brokers and salesmen whose licenses have been revoked at any time within one year prior to the time of the issue of publication.

This Wisconsin Real Estate Licensing law has been in operation a year. Mr. B. G. Packer, Director of Immigration, and secretary to the Real Estate Brokers' Board, gave to the writer the following information in regard to the results of the operation of the law so far.

This law requires registration of all real-estate brokers and salesmen doing business in the state. In the past there was no way to tell who they were or where located. The license is good for one year, and thereupon a new application must be made. This gives the board a check on the dealer's operations the preceding year. The board requires him to cite all legal actions arising out of his real-estate business whether he was plaintiff or defendant.

It is a common practice with some dealers to take a judgment note for commission which can be entered up without process and execution levied against the property of the defendants. The defendant can open up the judgment and put in a defense if he can show misrepresentation and fraud. This year, when several applicants applied for new licenses, the board found this condition and the licenses were refused.

The applicant for license must show affirmatively that he is trustworthy and competent. In the past the state took no pains to find this out. The licensing board operates as a poor man's court of redress in transactions arising out of the land business. In the past the purchaser's remedy was a more or less satisfactory suit at law.

The licensing board can make investigations and hold hearings on its own motion. In the past the initiative had to be taken by the party claiming deception.

Last year the board granted licenses to 4,600 brokers and salesmen, denied 20 applications, revoked 2 licenses, and has at present 60 hearings pending on applications for licenses in 1921.

The Wisconsin license law does not reach the owner who has worthless land to unload upon an unsophisticated purchaser. Besides this, the law has other limitations. But nevertheless it is a step ahead.

Pennsylvania, the Southern states, and cities in many parts of the country have required a license fee or an occupation tax from real-estate men, but such laws do not regulate, because, as the above-mentioned report states, "no matter how high the fee, the usual run of licensing or prosecuting official will not use his authority to establish moral standards." Furthermore, "in New York and most Northern and Western states, even the slight check of the occupation tax is absent and there is no formality to be observed in entering our profession by any person, no matter how unreliable, irresponsible, or incapable, and whatever his record."

After agitation covering a period of twelve years, the real-estate brokers of California succeeded in 1917 in having enacted a law for the regulation of real-estate brokerage. In 1918 this law was declared unconstitutional by the Supreme Court, on the ground that insurance men were exempted by the wording of the act and that such exemption made the law discriminatory.

The Real Estate Commissioner of the state gives the following synopsis of the law:

The act "provides for the issuance of licenses to two classes of persons--the broker himself, who, in addition to taking out a license, is required to put up a bond running to the state of California, and the salesman, who is defined as one in the employ of a licensed broker and ... is not required to put up a bond." The act is administered by a Real Estate Commissioner appointed by the Governor. Upon petition to the Real Estate Commissioner appointed by those aggrieved in their dealings with brokers or salesmen, a hearing is provided before the commissioner, and upon proper showing the petitioner may be granted the privilege of suing the broker on his bond.... There is also a provision for the filing of complaints against brokers and salesmen concerning their conduct and, upon investigation, if found guilty, the commissioner is empowered to revoke their licenses. The law provides a heavy penalty for a broker--a fine of $2,000 or a prison sentence of two years--and in the case of corporations, a maximum fine of $5,000. The fees for licenses are, for brokers, $10 per annum, and for salesmen, $2 per annum.

The operation of the law appears to have been extremely successful and to have been heartily indorsed by the public generally and by all the reliable real-estate dealers and salesmen in the state. The Real Estate Commissioner gives the following picture of the results of the law during the eight months it was in force:

1. It gave the realtors faith in each other, each being under bond and licensed by the commissioner with power of revocation in case of violation of the law.

2. It increased the confidence of the public generally in the realty business, for the law afforded the public a ready and inexpensive means of redress in case of wrongdoing.

3. During the eight months, some sixty complaints were filed with the commissioner, and all were adjusted without even a formal hearing up to the time the law was thrown out, March, 1918. Some twenty-five hundred dollars was returned to defrauded purchasers through appeals to the commissioner.

4. The deterrent effect of the law on wrongdoers will never be known, but must have been far-reaching.

5. So satisfactory was the law that the public, the bankers, and especially the realtors, are preparing again to present to the legislature during the winter of 1918-19 a more carefully worded law governing the realty business.

One of the services rendered by the Department of the Real Estate Commissioner was the issue of a directory of licensed real-estate brokers and salesmen in the state. The first copy was published October 1, 1917, and contained about four thousand names, as well as other material such as maps, laws, and legal opinions, designed to be of practical value to all realtors. It was intended that this directory be issued quarterly and be distributed to licensed brokers, with a subscription price to others of one dollar a year. The commissioner regarded this directory bulletin which bound together in fraternalism the real-estate men of the state, as only one of the many possibilities of extending valuable aids through his department to the real-estate profession, and so indirectly to the agricultural industry.

Although there have been attempts in other states to secure legislation, so far they have been unsuccessful. In essentials they have resembled the California law, although differing in details, such as amounts of bonds, fees, and penalties. In Minnesota, several years ago, the State Immigration Commission was instrumental in introducing a land-regulation bill which was killed by the efforts of the land dealers.

In 1914 the Executive Committee of the Real Estate Association of New York submitted for the consideration of the association a bill for the licensing of real-estate brokers and the creation of a real-estate commission. In 1916 a bill similar to this one was introduced in the legislature of the state of New York, but failed of passage. In Texas a bill was approved by the Texas Realty Association, but was not enacted into law. In addition to efforts for legislation in the states there have been national recommendations.

The Committee on State Legislation of the National Association of Real Estate Exchanges in 1913 reported on a bill for the regulation of the real-estate business. The main provisions are as follows:

A State Board on Real Estate Licenses shall be established, consisting of five members, all real-estate men, appointed by the Governor, and having its headquarters in the state capitol. Every person engaged in the real-estate business shall apply for a license to the board. The applicant shall present proof that his standing is above reproach and that his record for honesty and fair dealing is clear. The applicant shall file a satisfactory bond in the amount of $1,000, conditioned on the faithful performance of any undertaking as a real-estate broker, the bond to be renewed with each renewal of the annual license. The fee for the license shall be $10 for each dealer, firm, or corporation, and $2.50 for each salesman, the fees to be, respectively, $5 and $1 after the first year. Licenses shall expire each year. The board shall have power to revoke at any time any license where the holder thereof is guilty of gross misrepresentation in making sales, etc., or of any other conduct which, in the opinion of the board, is opposed to good business morals. The board shall investigate all complaints; it shall have power to subpoena witnesses. Any person violating the act shall be fined not less than the compensation or profit received or agreed to, and not more than four times that amount, or be imprisoned not more than thirty days, or both.

The Legislative Committee of the Interstate Realty Association of the Pacific Northwest has proposed a real-estate license law for the state of Washington, the main provisions of which are similar to the others already quoted.

Although there has been no successful state-wide provision, in Portland, Oregon, an ordinance licensing real-estate brokers was approved in 1912, including the salient features of the proposed state laws. Application is made to the city auditors, with proof of the applicant's good standing and square dealing. The Council Committee on licenses has power to revoke or withhold, and penalties are provided for.

As an example of the occupational tax law applying to the real-estate business, the law of the District of Columbia may be mentioned. The District of Columbia (1914) has a law imposing a license tax of $50 per annum on real-estate brokers or agents. The assessor of the District said that the fee was not large enough to restrict character of trade, and that the payment of the fee was the only qualification for a license.

A PUBLIC LAND EXCHANGE

In addition to the need for honest dealing there is everywhere felt the need of bringing farm sellers and buyers together through a public agency. Certain states, in co-operation with the Federal Department of Agriculture, have made provision for doing this. For this purpose an office is created similar to a public employment office. It aims to provide the farm sellers and buyers with more or less reliable information without cost to either side.

In the state of Maryland the Extension Service of the state college, in co-operation with the Federal Department of Agriculture, has worked out a farm-description blank for farm sellers. The blank contains questions in regard to the location of the farm, its size, distance from communication lines, and inhabited places of various sizes and market facilities, its soil, its fences, buildings, water supply, ownership, price, and other points intended to show the condition and value of the farm for sale. The office distributes these blanks among the county agents, from whom the farm sellers secure the blanks. The county agents forward the completed forms to the main state office, which periodically publishes the collected information for farm buyers.

This information is available to farm buyers for the mere asking. Anyone can see, in the state office or in the published volume, the blanks describing in detail the farms for sale. In this way they can be directly connected with the seller of the selected farm, without agents or advertising cost to either side. Thus misrepresentation can be avoided to a certain degree. The Extension Service, however, does not enter into any financial arrangement or give any guaranties. Aside from the information contained in the filled forms, it gives information of a general character concerning the agricultural possibilities of the state and of various sections and localities in it. At present the Service is particularly interested in locating the returned soldiers.

As such a public agency system is of comparatively recent origin and has not had time to develop, it is impossible to judge with certainty its future possibilities. In theory the operation of the system seems to be an easy matter, but in practice it is complicated. The farmers who intend to sell their holdings have to be informed of the work of the office, and equally the farm buyers have to be acquainted with the plan. This involves education of the farmers by an extensive advertising campaign, which requires time and expenditure of public money. However, there is a real need for such a public agency and the results of the attempts to establish and develop it have been encouraging.

It would be desirable that the states which have already established or will establish such public agencies should co-operate with one another through the Federal Department of Agriculture and, with the assistance of the latter, should organize a central office as a clearing house. Nation-wide advertisement should be made by the central office for all the states in co-operation. In this way the farm advertisements would be made more effective--unnecessary repetitions, and the expenses connected with these, would be avoided. Through interchange of experiences a uniform system might be established. Such a central office, in co-operation with the Immigration Bureau, Department of Labor, should inform immigrants who desire to establish rural homes of the various farm opportunities.

RECLAMATION A SEPARATE FUNCTION

Up to this time both public and private efforts have been applied to the reclaiming of unused lands, rendering valuable service to the progress of the country. There ought, however, to be no question whether reclamation work should be a public or a private enterprise. If a number, and even a large number, of the private land-development companies have hitherto mined in the pockets of their land buyers instead of in the land itself, this has been largely because of the lack of any public regulation of private land-improvement companies. However, a number, perhaps a majority, of the companies have improved their land and have secured settlers who have made a success in the cultivation of the improved land. Therefore it would be a grave mistake to abandon or even to repress private enterprise in land-development work. It should be encouraged by the extension of public credit through the land companies and by putting their business under public supervision.

Where considerable areas have to be reclaimed, involving large expenditures and a long period of waiting for returns, public reclamation is preferable.

Although reclamation and colonization work are closely connected and dependent upon each other, still there is a marked difference. It is one thing to plan and irrigate a desert area and quite a different thing successfully to populate the irrigated land. The first is mainly a technical enterprise, while the other deals mainly with human beings. The people who direct and prosecute reclamation works--civil engineers and other technical experts--might not be good colonizers. The duties of the latter consist in selecting suitable settlers, directing their land-cultivation work, and organizing and directing the community life of the settlers. On the other hand, colonizers, trained agriculturists, and community workers might not be able successfully to conduct reclamation works. Therefore these two fields ought to be recognized as distinct and provided for separately.

Almost all the proposed plans of land settlement fail to make such a distinction. They propose that the same public agency should acquire land, improve it, and colonize it. The same is true in regard to most of the private land-improvement and colonization projects. They plan to improve land and at the same time colonize it, which too often consists merely in securing land buyers and leaving the latter, after they have made their initial payment, entirely to their own fate.

Private land-improvement companies doing business in two or more states should be brought under the jurisdiction of the Federal Reclamation Service. They should be licensed, their projects approved, and their general methods of business regulated. Private companies doing business within state or city limits should be regulated by state irrigation or drainage district authorities, with whom the Federal Reclamation Service should co-operate in every possible way.

In order that the Federal Reclamation Service may be extended and expanded to meet the growing demands, further legislation must be passed by Congress. Liberal appropriations are needed both for the acquisition and reclamation of unused lands of different classes, as well as for the increase of the staff and working forces of the Service. The bills under consideration were discussed in Chapter VI. The bill introduced by Representative Mondell of Wyoming effectively provides for this service.

A COLONIZATION BOARD

The word "colonization" suggests the following: populating a given unused area of land suitable for cultivation, according to a plan covering the selection of people, the cultivation of the land, providing credit and markets, instruction in land cultivation, planning, organizing, and directing of community life in its numerous branches, such as co-operation for various purposes, education, recreation. Colonization work in the modern sense is a new, delicate, and complex field, for it affects all sides of human life.

There is a wide difference of opinion the country over as to whether colonization should be a public affair or be left to private initiative and effort. Those who favor private colonization claim that public colonization is wasteful, uneconomical, that it puts a new burden on the taxpayers, and savors of Socialism. Those who favor public colonization maintain that private colonization companies in the very nature of their endeavors work for their own profit, considering the settlers' interests and public welfare of secondary importance. Colonization results must not be counted only in the terms of money, but also in the terms of social value to the community and to the country.

Again the writer has to call attention to the fact that both public and private colonization is going on side by side all over the world. In certain foreign countries public colonization is predominant, while in this country the reverse is true. Only the state of California has undertaken public colonization as an experiment on a small scale, and so far with success.

It would be advisable that both public and private colonization go on, one competing with the other and learning from the other's experience. Private companies must be regulated and licensed by public authorities, and public credit should be extended to them. All this requires that the colonization work be organized on a nation-wide scale.

To meet the national need there should be established an interdepartmental Federal colonization board with the following duties:

(1) To make community plans. This would involve the location of settlements, their roads and building sites; plans for division of land into farms; plans for erection of farm buildings; plans for town sites and buildings as colony centers, parks as playgrounds, etc., all to be surveyed and put in working shape by the Reclamation Service, Department of the Interior.

(2) To select suitable people for settlement on the lands acquired and improved by the Reclamation Service, with the preference to be given to former soldiers.

(3) To distribute the selected immigrant settlers of non-English mother tongue, including soldiers, having in mind the need of mixing different races with the native settlers so as to facilitate the process of incorporating all into American life.

(4) To plan and organize the economic life of the colonies. This means the introduction of, and instruction in, farming and methods of cultivation suitable to the land, climate, and other conditions surrounding the colony, the organization of buying and selling co-operation in the colonies, provision of markets, etc.

(5) To plan and organize the educational, recreational, and general community life of the colonies--schools, libraries, lectures, games, etc.

(6) To regulate and license or charter private colonization companies.

Among the policies of the Colonization Board a very prominent one should be a proper distribution of the immigrant settlers. Owing to the lack of any public plan or measures for the distribution of the immigrants in the country in the past the results have been astonishing. The Little Polands, Italies, ghettos, Germanies, and others in our great industrial centers are well known, though the word "Little" is not applicable in every case. It is especially inapplicable where the compact immigrant settlements exceed in numbers the largest cities of their home countries. For instance, according to the last census figures, there were in the city of New York more Italians (including their children) than the population of Rome, more Germans than in Cologne, about as many Irish as the population of Dublin and Belfast together, and about three times as many Jews as there were in the British Empire.

All this is already known to the public at large. What is not popularly known is the fact that there are foreign provinces in the agricultural sections of the country. There whole counties and even a number of neighboring counties are populated by immigrants of the same race and nationality. Such provinces have become self-sufficient; they have their own towns, their own schools, churches, industries, stores, select local public officials of their own nationality, speak their own tongue, and live according to the traditions and spirit of their home country. These traditions and this spirit are kept alive by their schools, churches, and libraries, and by the absence of any direct contact with American customs and traditions. From such localities came a considerable number of the American-born drafted men who could not speak, write, or even understand English.

Such foreign provinces in the rural sections of the country are principally found in the North Middle Western states and Western states. When the writer, during his field investigation, arrived in such localities--for instance, in the southwestern part of North Dakota--he found that the townspeople, business men, and public officials, as a rule, understood English, but spoke German or Scandinavian among themselves. In talking with any man in the street the writer had to resort to the man's mother tongue, while the farmers back in the country, as a rule, did not speak English at all. Yet many of them were born in this country.

On the whole, the impression of the writer was that the larger the rural immigrant colony, the less it showed evidences of American influences. This was quite apparent in regard to the Slavic and especially the Polish colonies visited by the writer in a number of states.

The immigrants already settled in large colonies of one nationality cannot be redistributed, but they can be reached by other means, one of which is an efficient public-school system, which is dealt with in later chapters.

Measures should be undertaken for the distribution of the new immigrant settlers so as to avoid their congregation in large colonies of only one nationality. The experience of private land dealers and colonization companies shows that it is not wise to settle a single immigrant family among native settlers or the settlers of another nationality. Such a family becomes lonesome and sooner or later leaves the settlement. Therefore the immigrants must be settled in groups according to their nationalities.

The question is, how large such national groups must be in order to keep the settlers in the colony and at the same time to avoid their becoming clannish and remaining untouched by American influences for a generation or a number of generations. The observation of the writer and his interviews on this question with the people engaged in colonization have led him to the conclusion that such groups ought to be of from five to fifteen families each, settled in the same neighborhood among either groups of other nationalities or native settlers.

Such distribution of the immigrant settlers in smaller groups is favored by the immigrants themselves. As a rule, they are eager to learn American ways as soon as possible, and usually accede with alacrity to distribution, provided no violent compulsion is used and they are directed to land where they are able to make a success by their investment and toil, without being cheated or exploited. The writer discussed the size of a rural immigrant group of the same nationality in a number of the immigrant colonies. The settlers, even the Russian sectarian peasants, believed that if there were not less than five families in one group no loneliness would be experienced. If there were no more than ten or fifteen families there would be no danger of their becoming clannish and self-sufficient, for they would of necessity have to deal with other groups and intermingle with them for both business and social purposes.

A rigid selection of settlers on the basis of their ability to farm and to stay on the farm is of prime importance. Among the applicants for farms in new colonies there are three main classes of people, each distinct from the others: (1) those who have experience, knowledge, and otherwise ability for land cultivation and the capacity for sticking to a job. These should be selected and will contribute to the success of the colony, which ultimately depends upon the settlers themselves; (2) those who are hunters for easy pickings in the way of a piece of property or for an opportunity for safe investment or for speculation. These should be avoided as the plague; and (3) those who are not suited for rural life and heavy toil on the land, mostly city people who dream of changing their life for improvement of their health in the country, for an independent life, or for an easy-going life, of fresh air, sunshine, flowers, and birds. Such people are not able to make a success of farming and should be avoided. These classes of applicants are found among immigrants as well as among natives, soldiers, and civilians.

How important the selection of settlers is for the success of colonization and settlement on land is shown by the close scrutiny of prospective settlers made by the agents of modern private colonization companies and also by certain state immigration officials. They ask an applicant about his supply of money or credit, about his experience, about his past in detail, his habits, his inclinations, and his aspirations. They judge him by his appearance, his physique, and his health. He is also questioned about his family life; special attention is given to the attitude of his wife toward rural life, her past experience, the probability of her being satisfied and able to stay permanently on the farm and carry the heavy burdens of a farmer's wife. Finally, the prospective settler is warned of the existing conditions in the colony, of the heavy toil and the difficulties, and of the long period of waiting which must elapse before he can enjoy the results of his investment and labors. Selection made in this way will guarantee the success of a colonization enterprise, be it public or private.

EXTENSION OF PUBLIC CREDIT

A last measure which is extremely important and must not be overlooked in any planning for land settlement is the extension of public credit to settlers through the Federal Farm Loan Board. This, of course, applies not only to the settlers in the colonies established by the Federal Colonization Board, but also to those of private colonization companies regulated and chartered by the Colonization Board, and to individual settlers. There must be certain safeguards against loss. To accomplish this there could be established a settlers' credit division in the Federal Farm Loan Bureau, with a special land colonization credit fund. A similar plan was proposed in the bill introduced by Representative Knutson, May 27, 1919.[19]

Some such provision is indispensable in any comprehensive land policy, and should secure a place in legislative enactment.

CO-OPERATION INDISPENSABLE

No amount of legislation or smooth-running administrative machinery can provide, however, for one of the most fundamental factors in modern small-farm production.

Every colony of small farmers nowadays needs to provide for co-operation among its members. There is no other way for them to enjoy the technical advantages of large-scale farming in the buying of seeds, stock, fertilizers, tools, machinery, and other necessities at wholesale prices, in the selling of farm products at the best prices; in the establishment of creameries, etc. The buying of necessary costly machines, such as stumping machines, tractors, threshers, headers, is beyond the financial power of an individual settler. Even should he be able to acquire them, he cannot use such machines to their full capacity on his small piece of land. But in co-operation settlers are able to buy the heavy machinery and to use it to its fullest capacity. Mutual insurance and credit established through co-operation are another substantial assistance to the success of the settlers.

The co-operative buying and selling organization of a Finnish farming colony in upper Michigan which the writer investigated in detail proved to be a great money saver to the settlers. The enterprise has grown from a small undertaking into the largest business organization in the town, with its great warehouse overshadowing the railroad station. In the beginning the surrounding native farmers and townspeople were hostile toward it. They both feared the competition as well as the broader results of an undertaking of "foreigners," led by their "demagogic leaders." Its former opponents have radically changed their attitude, and many are joining the organization. They find that co-operation means voluntary, concerted, and co-ordinated action for the common advantage, and that it is not contrary to the American spirit.

One of the leaders of the Finnish co-operative association explained that the defects of the local private stores served as the first inducement for the settlers to establish a co-operative store.

The private stores usually set arbitrary and high prices on the goods, which are often of poor quality and limited variety. As a result, a co-operative store among our settlers was established. We found that the association, in its meetings and activities, served as a school for the development of mutual understanding and fellow-feeling among its members. In the direction of Americanization our co-operative movement has done much good already. Its success has made the native farmers respect us. A number of them have already joined our association. Should our enterprise grow wider it may be expected to unite the farmers of different nationalities, immigrants and natives, into one community.

The interviews of the writer with the native farmers fully substantiated these statements of the Finns. One of them said that when the Finnish settlers came the native-born people did not expect much good from them. They were looked upon as strange intruders, entirely ignorant in farming. But as time went on they made good not only as farmers, but also as business men in their co-operative buying and selling association. They were found to be good, sober, and industrious people.

The co-operative movement was apparent in northern Wisconsin, where numerous co-operative creameries have been organized among the settlers of various nationalities. The carrying of milk to the creamery results in the regular meeting of settlers every day; business meetings and other activities of the association afford opportunities for the settlers to get together and work together. In addition to this the immigrant settler, as a member of the co-operative association, comes face to face with the wider business world--banks, railways, commission merchants, manufacturers, market conditions, price fluctuations, etc. As an individual producer he comes to know the larger problems involved in marketing his product and his vision and understanding broaden.

Almost all immigrant settlers interviewed on the subject of co-operation were in favor of it. "Co-operation helps us!" were words often used in answer to the question why they favor co-operation. This "help" should not be understood in the material sense only. Co-operative action, though it begins in economics, extends to and ends in the creation of ideal, socio-psychological values. The co-operator works and fights in the spirit of solidarity. He satisfies his wants through concerted action. His psychology is more complex and his aims become higher than those of a private individual.

Co-operation is a child of necessity. It cannot be created by outside suggestion or mere preaching. When there is a need and conditions are favorable the co-operative movement comes into being. Unquestionably the need for co-operation is greater in the rural districts than in the cities, and yet the rural conditions in many respects make the development of co-operation more difficult. The main obstacles, according to the rural co-operators themselves, consist in the lack of business connections and markets, in the absence of knowledge of efficient business methods, and in credit difficulties. It is hard to find an able and trustworthy business manager for a co-operative store in a village.

Notwithstanding all difficulties, the co-operative movement among farmers and especially among immigrant settlers has lately begun to grow with extreme rapidity. For instance, in 1917 in the state of Wisconsin there were agricultural co-operative associations in the following numbers: 380 creameries, 718 cheese factories, 98 feed and produce associations, and 124 live-stock concerns.[20]

One of the first difficulties in the way of establishing a co-operative association is its incorporation proceeding. Most of the states up to this time have had no special laws covering co-operative associations. In such cases they have to be incorporated under the laws relating to private companies or those covering charity and public-welfare associations.

A number of states have enacted laws for the promotion and protection of co-operation among farmers. The Wisconsin law, Chapter 368, Laws of 1911, makes provision for the establishment of organizations conducting business on the co-operative plan. No member is allowed to own shares of a greater par value than one thousand dollars. No member is entitled to more than one vote. Dividends on the paid-up shares are allowed to be no more than 6 per cent per annum; 10 per cent on the net profits has to be set aside as a reserve fund. When this has accumulated up to 30 per cent of the paid-up shares, 5 per cent goes to the educational fund to be used for teaching co-operation. One half of the remainder of the profits has to be paid as a uniform dividend upon the amount of purchases of shareholders and upon the wages and salaries of the employees, while the other half has to be paid to the nonshareholders on the amount of their purchases.

In case of productive associations, such as co-operative creameries, or elevators, dividends have to be paid on raw materials delivered. In case an association is both a selling and productive enterprise, the dividends may be divided on both goods purchased and material delivered. All concerns which do not comply with the provisions of the above law are prohibited to use the term "co-operative" as a part of their corporate name or the designation of their business.

According to the Nebraska law, Senate File No. 88,

the words "co-operative company, corporation, or association" are defined to mean a company, corporation, or association which authorizes the distribution of its earnings in part or wholly on the basis of, or in proportion to, the amount of property bought from or sold to members, or of labor performed, or other service rendered to the corporation. A co-operative concern has the power "to regulate and limit the right of stockholders to transfer their stock, and to make by-laws for the management of its affairs, and to provide thereon the term and limitation of stock ownership, and for the distribution of its earnings."

The California law, Civil Code, Secs. 653M to 653S, provides for organization of agricultural, viticultural, and horticultural co-operative associations which shall not have a capital stock and shall not be working for profit. Each such association shall determine by its by-laws the amount of membership fee, the number and qualifications of members, conditions of voting, the methods of business, and the division of earnings.

There is no question that every state must have special legislation for co-operative associations quite distinct from that relating to private business concerns. A co-operative association must have the legal power to regulate and limit the right of shareholders to transfer their shares, to make by-laws for the management of business, to limit the share ownership, to decide on the proportion and method of distribution of its surplus earnings. It must limit dividends on shares to the prevailing rate of interest and provide a certain percentage for a reserve fund until the latter has accumulated up to a certain proportion of the capital invested. A part of the remainder should be retained for educational and other social-welfare purposes, the rest proportioned to the amounts of goods purchased, products contributed, or services rendered. The co-operative law should provide for one-member-one-vote. Irrespective of the number of shares owned, or the goods purchased, or the products contributed, or the services rendered, only one vote should be granted to each member.

Aside from such legislation, each state, as in New York, should have a special office with adequate forces for the advice and direction of farmers and settlers who desire to organize a co-operative association, as well as for those who have already established such an association and are meeting with difficulties.

[17] _Reclamation Record_, Department of the Interior, Washington, D. C., July, 1918, p. 306.

[18] Wisconsin Statutes, Chap. 656, Laws of 1919, Sect. 1636-225.

[19] See chap. vi.

[20] _Bulletin No. 182_, May, 1917, Agricultural Experiment Station, University of Wisconsin.